Corporations

Which best describes stock that is eligible to vote on corporate matters? A Authorized stock B Issued stock C Outstanding stock D Treasury stock

C--outstanding stock

Which of the following is MOST likely to succeed as a defense to a self-dealing transaction? A Disclosure to and ratification by a majority of the disinterested shareholders B Disclosure to and ratification by a majority of the disinterested directors C Disclosure to and ratification by a majority of the disinterested directors and shareholders D A transaction that is fair to the corporation

D is correct.

Which of the following statements regarding preemptive rights is TRUE? A Preemptive rights provide existing shareholders the right to buy stock issued by the corporation in the future at a bargain price. B Preemptive rights require existing shareholders to buy additional shares that are issued by a corporation to maintain their proportional ownership in the corporation. C Preemptive rights give preferred shareholders the opportunity to convert their shares into common stock of the corporation. D Shareholders generally do not have preemptive rights, unless the articles of incorporation provide otherwise.

D is correct; this is the true statement out of the choices.

Which of the following issues is least likely to require shareholder approval? A Dissolution B Share exchange C Election of directors D An officer's compensation

D--An officer's compensation.

__________ manage and direct the management of the corporation's business and affairs and are responsible for major corporate decisions.

Directors

Unless the agreement otherwise provides, for what length of time is a pre-incorporation stock subscription agreement irrevocable?

Six months