Bus 100 Chapter 4

J.R. Imax, a financial investor, wants to control the Simex Company. So far he has been unsuccessful in purchasing enough stock to give him control. To reach his goal, which technique should he use to gather enough stockholder votes too control the company? a. Hostile takeover b. Leveraged buyout c. Merger d. Acquisition e. Proxy fight

E

PepsiCo acquired Pizza Hut. What type of Merger was this? a. Limited b. Syndicated c. Joint venture d. Horizontal e. Vertical

E

T or F A limited partner is responsible for any debts of the partnership, regardless of whether he or she was directly involved with the transaction that created the debt

False

T or F Compared to a corporation, a partnership is more difficult and more expensive to establish

False

T or F Corporate officers are elected by the firms stockholders

False

T or F Preferred stockholders elect the board of directors that manage the day-to-day business activities f a corporation

False

T or F Unlimited liability is an advantage of a sole proprietorship

False

T or F The S corporation form of organization allows a corporation to avoid double taxation

True

T or F The amount paid for stock is the most a stockholder can loose in the corporate form of ownership

True

T or F The articles of partnership is a written contract describing the terms of the partnership

True

T or F The board of directors is directly responsible to the stockholders

True

T or F a coonglomerate merger takes place between firms in completely different industries

True

The ability to combine skills and knowledge is an advantage of a a. Partnership b. Sole proprietorship c. Limited venture d. a Joint venture e. a Not-for-profit corporation

A

When two business firms need large sums of money to finance a major project, that are likely to establish a a. Closed corporation b. Syndicate c. Limited venture d. S corporation e. Conglomerate venture

B

A corporation incorporated in Texas doing business in New York is known in a. New York as a domestic corporation b. Texas as a foreign corporation c. Texas as a domestic corporation d. New York as an alien corporation e .he firm cannot do business in New York

C

A corporation whose stock is owned by relatively few people is called a(n) a. Limited corporation b. Open corporation c. Closed corporation d. Domestic corporation e. Friendly corporation

C

During College, Elyssa Wood earned extra money by using her culinary skills to cater special parties. After graduation, she decided to turn her part time job into a full time business that she plans to expand in the future. In the meantime, she wants to maintain complete control of the business. She will most likely organize the business as a a. Limited partnership b. Corporation c. General partnership. d. Sole proprietorship e. S corporation

D

One of the advantages of an LLC is that owners have ____________ liability a. Unlimited b. Restricted c. Special d. Limited e. Taxable

D

Unlimited liability means a. There is no limit on the amount an owner can barrow b. Creditors will absorb any loss from nonpayment of debt c. The business can borrow money for any type of business d. The owner is responsible for any business debts e. Stockholders can barrow money from the business

D

Which of the following is not an advantage of a corporate form of ownership? a. It is easier to raise capital b. Ownership can be transferred easily and quickly c. The death of an owner does not terminate the corporation d. Profits are taxed twice e. The liability of the owners is limited

D