Question 1

Samson owns 1,500 shares out of the 10,000 outstanding shares of Comakote Corporation.If Comakote declares a stock dividend of 30 percent,what will be the total stock Samson has upon receiving his stock dividend?

Accepted Answer

A)  2,250
B)  4,500
C)  1,950
D)  5,400 C

Question 2

The written document submitted by a person who has been authorized by a shareholder to vote the shareholder's shares at the shareholders' meetings in the event of the shareholder's absence is known as the ________.

Accepted Answer

A)  record date
B)  notice of the shareholder's meeting
C)  certificate of authority
D)  proxy D

Question 3

A(n)________ is a member of a board of directors who is not an officer of the corporation.

Accepted Answer

A)  corporate officer
B)  chief executive officer
C)  ombudsman
D)  outside director D

Question 4

According to the Sarbanes-Oxley Act,the ________,a federal government agency,may issue an order prohibiting any person who has committed securities fraud from acting as an officer or a director of a public company.

Accepted Answer

A)  United States International Trade Commission
B)  Federal Reserve System
C)  Federal Communications Commission
D)  Securities and Exchange Commission

Question 5

Jameson works for Fishy-Mart Corporation,a chain of superstores that sell large quantities of seafood.His job is to locate future sites for Fishy-Mart stores.Jameson finds a piece of land near a coastline that would make a great site for a Fishy-Mart store.Jameson makes his friend purchase the property from its current owner.After that,they sell the property to Fishy-Mart and share the profits.Jameson does not disclose his interest in the property while recommending the site to Fishy-Mart.Which of the following duties of loyalty has Jameson breached in this scenario?

Accepted Answer

A)  usurping a corporate opportunity
B)  self-dealing
C)  competing with the corporation
D)  proxy

Question 6

In a voting trust,the legal titles to the shares given to the trustee are held in the name of the shareholders.

Accepted Answer

A) True 
 B)False

Question 7

A lawsuit a shareholder brings against an offending party on behalf of a corporation when the corporation itself fails to bring the lawsuit is known as a ________.

Accepted Answer

A)  notice of the shareholder
B)  derivative action
C)  class action suit
D)  contract action

Question 8

What is the CEO and CFO provision laid out by the Sarbanes-Oxley Act of 2002?

Accepted Answer

The answer of What is the CEO and CFO provision...

Question 9

Marshall is the purchasing agent for DigitoolArt Corporation.His job requires him to negotiate and execute contracts for purchasing office supplies and equipment for the corporation.Assume that Bronson,a computer salesperson,pays Marshall a $20,000 kickback to purchase from him computers needed by DigitoolArt Corporation.Which of the following duties of loyalty has Marshall breached in this scenario?

Accepted Answer

A)  competing with the corporation
B)  making a secret profit
C)  self-dealing
D)  usurping a corporate opportunity

Question 10

To prove usurping by a director or an officer,a corporation must have the financial ability to take advantage of the usurped opportunity.

Accepted Answer

A) True 
 B)False

Question 11

The Sarbanes-Oxley Act contains provisions for prosecuting U.S.firms that bribe foreign officials.

Accepted Answer

A) True 
 B)False

Question 12

Shareholders of a corporation act as agents of the corporation.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is a federal statute that deals with corporate bribery between U.S.companies and officials of other countries?

Accepted Answer

A)  Sarbanes-Oxley Act
B)  Glass-Steagall Act
C)  Deregulation and Monetary Control Act
D)  Foreign Corrupt Practices Act

Question 14

Shareholders elect a panel of decision makers known as the ________.

Accepted Answer

A)  registered agents
B)  corporate officers
C)  stakeholders
D)  board of directors

Question 15

The ________ Act prohibits public companies from making personal loans to their directors or executive officers.

Accepted Answer

A)  Foreign Corrupt Practices
B)  Deregulation and Monetary Control
C)  Sarbanes-Oxley
D)  Commodity Futures Modernization

Question 16

The determination of whether a corporate director or officer has met his or her duty of care is measured in hindsight.

Accepted Answer

A) True 
 B)False

Question 17

________ are employees of a corporation who are appointed by the board of directors to manage the day-to-day operations of the corporation.

Accepted Answer

A)  Corporate officers
B)  Shareholders
C)  Registered agents
D)  Ombudsmen

Question 18

The secret profits obtained by a director or officer cannot be recovered by a corporation.

Accepted Answer

A) True 
 B)False

Question 19

What is the supramajority voting requirement for shareholders?

Accepted Answer

The answer of What is the supramajority voting requirement for...

Question 20

Which of the following is true of shareholders?

Accepted Answer

A)  They cannot enter into contracts that bind the corporation.
B)  They cannot vote to elect the board of directors.
C)  They cannot take active charge in deciding fundamental changes in the corporation.
D)  They are considered agents of the corporation.

Exam 37: Corporate Governance and the Sarbanes-Oxley Act

Samson owns 1,500 shares out of the 10,000 outstanding shares of Comakote Corporation.If Comakote declares a stock dividend of 30 percent,what will be the total stock Samson has upon receiving his stock dividend?

The written document submitted by a person who has been authorized by a shareholder to vote the shareholder's shares at the shareholders' meetings in the event of the shareholder's absence is known as the ________.

A(n) ________ is a member of a board of directors who is not an officer of the corporation.

According to the Sarbanes-Oxley Act,the ________,a federal government agency,may issue an order prohibiting any person who has committed securities fraud from acting as an officer or a director of a public company.

In a voting trust,the legal titles to the shares given to the trustee are held in the name of the shareholders.

A lawsuit a shareholder brings against an offending party on behalf of a corporation when the corporation itself fails to bring the lawsuit is known as a ________.

What is the CEO and CFO provision laid out by the Sarbanes-Oxley Act of 2002?

To prove usurping by a director or an officer,a corporation must have the financial ability to take advantage of the usurped opportunity.

The Sarbanes-Oxley Act contains provisions for prosecuting U.S.firms that bribe foreign officials.

Shareholders of a corporation act as agents of the corporation.

Which of the following is a federal statute that deals with corporate bribery between U.S.companies and officials of other countries?

Shareholders elect a panel of decision makers known as the ________.

The ________ Act prohibits public companies from making personal loans to their directors or executive officers.

The determination of whether a corporate director or officer has met his or her duty of care is measured in hindsight.

________ are employees of a corporation who are appointed by the board of directors to manage the day-to-day operations of the corporation.

The secret profits obtained by a director or officer cannot be recovered by a corporation.

What is the supramajority voting requirement for shareholders?

Which of the following is true of shareholders?