Question 1

Whether a corporation is a de facto corporation may be challenged by:

Accepted Answer

A)   an individual.
B)   another corporation.
C)   the state.
D)   Any of these.

Question 2

The Internal Revenue Service allows taxation of certain corporations to be similar to that of partnerships.

Accepted Answer

A) True 
 B)False

Question 3

Define "promoter" in reference to a corporation.

Accepted Answer

A promoter is a person who brings about ...

Question 4

A corporation formed in substantial compliance with the incorporation statute and the required organizational procedures is a:

Accepted Answer

A)   de facto corporation.
B)   de jure corporation.
C)   corporation by estoppel.
D)   private corporation.

Question 5

Tolkien Corporation,incorporated in Delaware,opens a warehouse in a western state from which it ships goods.If Tolkien does not have a certificate of authority to do business within the western state:

Accepted Answer

A)   it will face no sanctions or penalties.
B)   the corporation will be shut down.
C)   the corporation's officers and directors may be held personally liable on contracts made within the state.
D)   Any of these may happen.

Question 6

The majority of courts view a stock subscription as merely an offer that cannot be accepted until:

Accepted Answer

A)   the corporation enters a novation with the subscriber.
B)   the promoter signs in the name of the corporation.
C)   the corporation comes into existence.
D)   there is a written agreement. C

Question 7

If an act is ultra vires,it is beyond the legal authority of the corporation.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is not a characteristics of a corporation?

Accepted Answer

A)   It has perpetual existence.
B)   It is a legal entity of its own.
C)   It is able to be sued and to sue.
D)   It is usually managed by its shareholders.

Question 9

The business corporation is a key institution not only in the American economy but also in the world power structure.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following may influence a promoter to choose to incorporate in a particular state?

Accepted Answer

A)   Its restrictions on dividend payments
B)   Its tax on corporate earnings
C)   The rights granted to shareholders
D)   All of these

Question 11

Zeron Corporation is incorporated in West Virginia.It now wants to open a retail outlet in Kentucky.Zeron must obtain a certificate of authority allowing it to do business in Kentucky.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following names would NOT be permitted under most general incorporation statutes?

Accepted Answer

A)   Acme Ltd.
B)   Acme Co.
C)   Acme Inc.
D)   Acme

Question 13

In corporations,the managers are necessarily owners.

Accepted Answer

A) True 
 B)False

Question 14

Under the RMBCA,a corporation can act as an incorporator of another corporation.

Accepted Answer

A) True 
 B)False  True

Question 15

Tavin,employed by Moreba Corporation,fraudulently represents Moreba's product while attempting to make a sale.Tavin,but not Moreba Corporation,may be found liable for fraud.

Accepted Answer

A) True 
 B)False  False

Question 16

A postincorporation subscription is:

Accepted Answer

A)   like a preincorporation subscription in that the subscriber may withdraw the offer to enter into the subscription any time before the corporation accepts it.
B)   treated as a contract between the subscriber and the corporation.
C)   not recognized under the RMBCA.
D)   defined under the RMBCA as a contract between all subscribers.

Question 17

Which of the following run the day-to-day operations of a corporation?

Accepted Answer

A)   Shareholders
B)   Board of directors
C)   Officers
D)   Subscribers

Question 18

Which of the following is correct regarding the characteristics of a corporation?

Accepted Answer

A)   A corporation is considered a person within the meaning of the Eighth Amendment.
B)   The Fifth Amendment provisions against self-incrimination protect a corporation.
C)   A corporation is protected by the Fourth Amendment's provision against unreasonable searches and seizures.
D)   A corporation is taxed like a partnership.

Question 19

A suit may be brought by the state to challenge the existence of a de facto corporation in a quo warranto action.

Accepted Answer

A) True 
 B)False

Question 20

A corporation is considered a citizen:

Accepted Answer

A)   under the Fourteenth Amendment's "privileges or immunities" clause.
B)   of the state of its incorporation or where it has its principal office.
C)   of all states where it does business.
D)   All of these statements are true.

Exam 33: Nature,formation,and Powers

Whether a corporation is a de facto corporation may be challenged by:

Correct AnswerverifiedShow Answer

The Internal Revenue Service allows taxation of certain corporations to be similar to that of partnerships.

Correct AnswerverifiedShow Answer

Define "promoter" in reference to a corporation.

Correct AnswerverifiedA promoter is a person who brings about ...View AnswerShow Answer

A corporation formed in substantial compliance with the incorporation statute and the required organizational procedures is a:

Correct AnswerverifiedShow Answer

Tolkien Corporation,incorporated in Delaware,opens a warehouse in a western state from which it ships goods.If Tolkien does not have a certificate of authority to do business within the western state:

Correct AnswerverifiedShow Answer

The majority of courts view a stock subscription as merely an offer that cannot be accepted until:

Correct AnswerverifiedC

If an act is ultra vires,it is beyond the legal authority of the corporation.

Correct AnswerverifiedShow Answer

Which of the following is not a characteristics of a corporation?

Correct AnswerverifiedShow Answer

The business corporation is a key institution not only in the American economy but also in the world power structure.

Correct AnswerverifiedShow Answer

Which of the following may influence a promoter to choose to incorporate in a particular state?

Correct AnswerverifiedShow Answer

Zeron Corporation is incorporated in West Virginia.It now wants to open a retail outlet in Kentucky.Zeron must obtain a certificate of authority allowing it to do business in Kentucky.

Correct AnswerverifiedShow Answer

Which of the following names would NOT be permitted under most general incorporation statutes?

Correct AnswerverifiedShow Answer

In corporations,the managers are necessarily owners.

Correct AnswerverifiedShow Answer

Under the RMBCA,a corporation can act as an incorporator of another corporation.

Correct AnswerverifiedTrue

Tavin,employed by Moreba Corporation,fraudulently represents Moreba's product while attempting to make a sale.Tavin,but not Moreba Corporation,may be found liable for fraud.

Correct AnswerverifiedFalse

A postincorporation subscription is:

Correct AnswerverifiedShow Answer

Which of the following run the day-to-day operations of a corporation?

Correct AnswerverifiedShow Answer

Which of the following is correct regarding the characteristics of a corporation?

Correct AnswerverifiedShow Answer

A suit may be brought by the state to challenge the existence of a de facto corporation in a quo warranto action.

Correct AnswerverifiedShow Answer

A corporation is considered a citizen:

Correct AnswerverifiedShow Answer

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A promoter is a person who brings about ...
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C

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True

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False

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