Intro to Business Ch. 5

Which one of the following statements is NOT accurate in relation to shareholders and their conduct in a​ corporation?

Because shareholders elect the​ directors, the shareholders are the final governing body of the corporation.

Which form of business has most of the characteristics of a regular corporation but adds the legal constraint that the company has to follow a specified nonfinancial​ goal?

Benefit corporations

General Motors​ (GM) is the largest United States-based auto manufacturing corporation. Who is the highest ranking officer at​ GM?

Chief Executive Officer

The​ policies, procedures, and systems that oversee the legal operations of an organization are referred to as​ what?

Corporate governence

Which of the following represents a legal​ body, separate from any​ individual, that can possess property and conduct​ business?

Corporation

What is an advantage of operating a sole​ proprietorship?

Fewer limitations on personal income

What is a disadvantage of operating a sole​ proprietorship?

Finite life span

Federal law now requires that a majority of the directors on the board of a corporation be​ _______.

Independent

NoName International is a public company. NoName has a Board of Directors comprised of 18 members. Of the​ following, who traditionally oversees the members of the Board of​ Directors?

Independent board chair at NoName International

​A(n) _____________ occurs when an individual or a group of people buy a​ company's publicly traded stock mainly by using borrowed funds.

Leveraged buyout

William Russell recently started a​ home-based consulting​ company, WR​ Consulting, as a sole proprietorship. Which of the following is a disadvantage of this form of​ business?

Limited managerial perspective for William

A business with one or more general partners with the same unlimited liability as a sole proprietor is known as a​ __________.

Limited partnership

Which of the following is an advantage of​ corporations?

Longevity

​Corinne, Kayla,​ Ann, and Mishika are starting their business as a partnership. Which of the following is an advantage of this form of​ business?

More resources

Which one of the following statements is NOT accurate in relation to the responsibilities of the board of directors of a​ corporation?

Much of the attention focused on corporate reform in recent years has zeroed in on boards being not too closely allied with management.

Bob and Rob have started a food delivery business together called Grub Galore in their college town. They have not incorporated their business and they run it from​ Bob's basement and garage. Grub Galore is an example of which form of business​ ownership?

Partnership

Every public corporation is susceptible to a takeover. Which of the following is a defense against unwanted​ takeovers?

Poison pill

Which of the following is a disadvantage of​ partnerships?

Potential for conflict

Which form of business is also known as a closely held​ corporation?

Private corporation

Which one of the following statements is accurate as regards functions of a​ corporation?

Public corporations are said to be publicly held or publicly traded.

Which of the following is a disadvantage of​ corporations?

Reporting requirement

Operating ABC Tools as a public​ company, founders are discovering that​ ______ is a key disadvantage of their form of business.

Reporting requirements

Which of the following limits a sole​ proprietor's ability to​ expand?

Resource limitations

Investors who purchase shares of stock in a company are called​ ________.

Shareholders

Which of the following is an advantage of a sole​ proprietorship?

Single layer taxation

Which statement describes the advantage of operating a sole​ proprietorship?

Sole proprietors have more privacy and generally are not required to report anything to anyone.

A business that is owned by one individual is a​ __________.

Sole proprietorship

Susan operates and owns a small business from home in her own name.​ Susan's business is most likely a​ _______.

Sole proprietorship

Which one of the following statements describes a disadvantage of operating a sole​ proprietorship?

Sole proprietorships have fewer financial resources and fewer ways to get additional funds from lenders or investors.

The federal government requires which of the following for the​ make-up of a board of​ directors?

The majority of seats must be held by independent directors

Which of the following is a characteristic of a general​ partnership?

The partners have joint liability for the firm's financial obligations

William Russell recently started a​ home-based consulting​ company, WR​ Consulting, as a sole proprietorship. Which of the following is NOT an advantage of this form of business for​ William?

There are limits on William's personal income

Jason and Jeanette are starting their business as a partnership along with eight other friends. They should understand that this form of business is plagued with which of the following​ disadvantages?

Unlimited liability

Which of the following is a disadvantage of​ partnerships?

Unlimited liability

A complete definition of corporate governance is​ ________.

a description of all the​ policies, procedures,​ relationships, and systems in place to oversee the successful and legal operation of the enterprise

You own shares of ThatCo International. The annual meeting is scheduled for next month and you realize you cannot attend it. When you authorize management to vote on your​ behalf, you are authorizing​ ______.

a proxy

An S corporation is a​ ________.

corporation allowed to sell stock to a limited number of investors while enjoying the​ pass-through taxation of a partnership