Question :
Multiple Choice Questions31. A corporation owned by
A. the individual who started the : 1197667
Multiple Choice Questions31. A corporation is owned by
A. the individual who started the company.
B. its board of directors.
C. the president of the corporation.
D. its stockholders.
32. The stockholders of a corporation
A. have no personal liability for the debts of the corporation.
B. are agents of the corporation empowered to act for the firm.
C. cannot sell their share of stock without obtaining the agreement of other stockholders.
D. will receive a dividend each year.
33. One disadvantage of a corporation is
A. limited liability.
B. continuous existence.
C. double taxation.
D. transferability of ownership rights.
34. Which of the following statements is correct?
A. Shareholders have personal liability for a corporation’s debts.
B. Shareholders must obtain the consent of other shareholders to sell their shares or buy more shares.
C. Limited liability partnership (LLP) partners have liability for their own actions and the actions of those under their control or supervision.
D. Shareholders are legally prohibited from acting as an officer or employee of a corporation.
35. Subchapter S corporations
A. have the disadvantage of double taxation.
B. require that shareholders report their share of profits on their partnership tax returns.
C. have the advantage that shareholders can take part in policy and operating decisions.
D. are entities formed as corporations but are treated essentially as a partnership so the corporation pays no income tax.
36. Which of the following statements is correct?
A. The owners of preferred stock are the only stockholders who have the right to vote.
B. All stockholders are guaranteed the right to receive annual dividends.
C. The issuing corporation may retain the right to repurchase shares of preferred stock from the stockholders at a specific price.
D. In a liquidation, common shareholders are paid before preferred shareholders.
37. Common stockholders will receive a dividend
A. in every year that the corporation is profitable.
B. in every year that the board of directors declares a dividend.
C. every year, whether the corporation is profitable or not.
D. every year that profits exceed a stated amount.
38. When the issuing corporation retains the right to repurchase shares of preferred stock at a specified price, the preferred stock is said to be
A. convertible.
B. callable.
C. participating.
D. nonparticipating.
39. If only one class of stock is issued by a corporation, it is referred to as
A. preferred stock.
B. company stock.
C. treasury stock.
D. common stock.
40. Which of the following statements is correct?
A. Market value is the figure selected by the organizers of the corporation to be assigned to each share of stock for accounting purposes.
B. If there is only one class of stock, the stock is called preferred stock.
C. The authorized capital stock is the number of shares that have been issued and are still in the hands of stockholders.
D. In the event of liquidation, preferred stockholders have a claim on assets before that of common stockholders.
