Question 1

The duty of care is a fiduciary duty.

Accepted Answer

A) True 
 B)False

Question 2

Analyze derivative lawsuits and their purpose.

Accepted Answer

A derivative lawsuit or derivative actio...

Question 3

Explain cumulative voting and its differences from noncumulative voting.

Accepted Answer

Cumulative voting is a system in which a shareholder can accumulate all of his or her votes and vote them all for one candidate or split them among several candidates.Noncumulative or straight voting is a system in which each shareholder votes the number of shares he or she owns on candidates for each of the positions open.Noncumulative voting favors candidates who possess the majority of the votes while cumulative voting gives a minority shareholder a better opportunity to elect someone to the board of directors.Since it involves weighted voting,cumulative voting systems tend to normalize the role that the number of shares plays in a voting scenario.

Question 4

The ________ is responsible for formulating policy decisions that affect the management and operation of the corporation.

Accepted Answer

A)   ombudsman
B)   board of directors
C)   shareholder
D)   corporate officer

Question 5

The corporate officers are elected by the board of directors at such time and by such manner as prescribed in the corporation's bylaws.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following is true of a derivative action?

Accepted Answer

A)   A settlement of a derivative action requires court approval.
B)   A shareholder's successful derivative action entails the damages to be awarded solely to the shareholder.
C)   A derivative action is brought by the corporation against an offending party.
D)   A board member who causes harm to the corporation is legally protected from a derivation action.

Question 7

Describe the business judgment rule and analyze its importance with an example.

Accepted Answer

The business judgment rule states that d...

Question 8

Duty of loyalty requires directors to subordinate their personal interests to those of the corporation and its shareholders.

Accepted Answer

A) True 
 B)False

Question 9

The right of first refusal gives existing shareholders the option of subscribing to new shares being issued in proportion to their current ownership interests.

Accepted Answer

A) True 
 B)False

Question 10

Denizence Informatics has expanded its board to incorporate more members.Emma,the chief technology officer at Denizence,has been appointed to serve on the board.Which of the following roles has Emma adopted in the above scenario?

Accepted Answer

A)   ombudsman
B)   outside director
C)   inside director
D)   shareholder C

Question 11

Anne,a shareholder of an insurance company,is unable to attend the shareholders' meeting held by the board of directors of the company.In order to make her vote count,she appoints Dexter,a friend,to attend the meeting and cast a vote in her name.This is an example of a ________.

Accepted Answer

A)   liability
B)   proxy
C)   dividend
D)   scienter

Question 12

Describe the role of a corporate officer and its relation to the board of directors and the corporation.

Accepted Answer

A corporate officer is an employee of a ...

Question 13

The ________ advocates that a greater than majority of shares constitutes a quorum of the vote of the shareholders.

Accepted Answer

A)   supramajority requirement
B)   simple majority rule
C)   business judgment rule
D)   alter ego doctrine

Question 14

Which of the following is true of preemptive rights?

Accepted Answer

A)   They allow existing shareholders to sell their shares back to the corporation.
B)   They may be exercised by shareholders only for a given period of time.
C)   They help in diluting a shareholder's interest in the company.
D)   They enable shareholders to procure new shares issued by the corporation. D

Question 15

________ are employees of a corporation who are appointed by the board of a corporation to manage the day-to-day operations of the corporation.

Accepted Answer

A)   Ombudsmen
B)   Corporate officers
C)   Outside directors
D)   Non-executive directors

Question 16

The RMBCA establishes a majority of ________ as a quorum to hold a meeting of the shareholders.

Accepted Answer

A)   outstanding shares
B)   treasury stock
C)   treasury shares
D)   reacquired stock

Question 17

Each director in a board of directors has only one vote.

Accepted Answer

A) True 
 B)False

Question 18

A shareholder's authorization of another person to vote the shareholder's shares at the shareholders' meetings in the event of the shareholder's absence is called a ________.

Accepted Answer

A)   liability
B)   dividend
C)   proxy
D)   quorum

Question 19

The Inkilwas Corporation has 30,000 shares outstanding.A shareholders' meeting is duly called to amend the articles of incorporation.According to the RMBCA,what is the minimum outstanding shares that must be represented in this case to have a quorum?

Accepted Answer

A)   12,001
B)   18,501
C)   15,001
D)   17,501

Question 20

Officers are liable on an unauthorized contract if the corporation does not ratify it.

Accepted Answer

A) True 
 B)False

Exam 28: Corporate Governance and the Sarbanes-Oxley Act

The duty of care is a fiduciary duty.

Correct Answer
verified

Analyze derivative lawsuits and their purpose.

Correct Answer
verified
A derivative lawsuit or derivative actio...
View Answer

Explain cumulative voting and its differences from noncumulative voting.

The ________ is responsible for formulating policy decisions that affect the management and operation of the corporation.

Correct Answer
verified

The corporate officers are elected by the board of directors at such time and by such manner as prescribed in the corporation's bylaws.

Correct Answer
verified

Which of the following is true of a derivative action?

Correct Answer
verified

Describe the business judgment rule and analyze its importance with an example.

Correct Answer
verified
The business judgment rule states that d...
View Answer

Duty of loyalty requires directors to subordinate their personal interests to those of the corporation and its shareholders.

Correct Answer
verified

The right of first refusal gives existing shareholders the option of subscribing to new shares being issued in proportion to their current ownership interests.

Correct Answer
verified

Denizence Informatics has expanded its board to incorporate more members.Emma,the chief technology officer at Denizence,has been appointed to serve on the board.Which of the following roles has Emma adopted in the above scenario?

Correct Answer
verified
C

Anne,a shareholder of an insurance company,is unable to attend the shareholders' meeting held by the board of directors of the company.In order to make her vote count,she appoints Dexter,a friend,to attend the meeting and cast a vote in her name.This is an example of a ________.

Correct Answer
verified

Describe the role of a corporate officer and its relation to the board of directors and the corporation.

Correct Answer
verified
A corporate officer is an employee of a ...
View Answer

The ________ advocates that a greater than majority of shares constitutes a quorum of the vote of the shareholders.

Correct Answer
verified

Which of the following is true of preemptive rights?

Correct Answer
verified
D

________ are employees of a corporation who are appointed by the board of a corporation to manage the day-to-day operations of the corporation.

Correct Answer
verified

The RMBCA establishes a majority of ________ as a quorum to hold a meeting of the shareholders.

Correct Answer
verified

Each director in a board of directors has only one vote.

Correct Answer
verified

A shareholder's authorization of another person to vote the shareholder's shares at the shareholders' meetings in the event of the shareholder's absence is called a ________.

Correct Answer
verified

The Inkilwas Corporation has 30,000 shares outstanding.A shareholders' meeting is duly called to amend the articles of incorporation.According to the RMBCA,what is the minimum outstanding shares that must be represented in this case to have a quorum?

Correct Answer
verified

Officers are liable on an unauthorized contract if the corporation does not ratify it.

Correct Answer
verified

Exam 28: Corporate Governance and the Sarbanes-Oxley Act

The duty of care is a fiduciary duty.

Correct AnswerverifiedShow Answer

Analyze derivative lawsuits and their purpose.

Correct AnswerverifiedA derivative lawsuit or derivative actio...View AnswerShow Answer

Explain cumulative voting and its differences from noncumulative voting.

The ________ is responsible for formulating policy decisions that affect the management and operation of the corporation.

Correct AnswerverifiedShow Answer

The corporate officers are elected by the board of directors at such time and by such manner as prescribed in the corporation's bylaws.

Correct AnswerverifiedShow Answer

Which of the following is true of a derivative action?

Correct AnswerverifiedShow Answer

Describe the business judgment rule and analyze its importance with an example.

Correct AnswerverifiedThe business judgment rule states that d...View AnswerShow Answer

Duty of loyalty requires directors to subordinate their personal interests to those of the corporation and its shareholders.

Correct AnswerverifiedShow Answer

The right of first refusal gives existing shareholders the option of subscribing to new shares being issued in proportion to their current ownership interests.

Correct AnswerverifiedShow Answer

Denizence Informatics has expanded its board to incorporate more members.Emma,the chief technology officer at Denizence,has been appointed to serve on the board.Which of the following roles has Emma adopted in the above scenario?

Correct AnswerverifiedC

Anne,a shareholder of an insurance company,is unable to attend the shareholders' meeting held by the board of directors of the company.In order to make her vote count,she appoints Dexter,a friend,to attend the meeting and cast a vote in her name.This is an example of a ________.

Correct AnswerverifiedShow Answer

Describe the role of a corporate officer and its relation to the board of directors and the corporation.

Correct AnswerverifiedA corporate officer is an employee of a ...View AnswerShow Answer

The ________ advocates that a greater than majority of shares constitutes a quorum of the vote of the shareholders.

Correct AnswerverifiedShow Answer

Which of the following is true of preemptive rights?

Correct AnswerverifiedD

________ are employees of a corporation who are appointed by the board of a corporation to manage the day-to-day operations of the corporation.

Correct AnswerverifiedShow Answer

The RMBCA establishes a majority of ________ as a quorum to hold a meeting of the shareholders.

Correct AnswerverifiedShow Answer

Each director in a board of directors has only one vote.

Correct AnswerverifiedShow Answer

A shareholder's authorization of another person to vote the shareholder's shares at the shareholders' meetings in the event of the shareholder's absence is called a ________.

Correct AnswerverifiedShow Answer

The Inkilwas Corporation has 30,000 shares outstanding.A shareholders' meeting is duly called to amend the articles of incorporation.According to the RMBCA,what is the minimum outstanding shares that must be represented in this case to have a quorum?

Correct AnswerverifiedShow Answer

Officers are liable on an unauthorized contract if the corporation does not ratify it.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
A derivative lawsuit or derivative actio...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The business judgment rule states that d...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
C

Correct Answer
verified

Correct Answer
verified
A corporate officer is an employee of a ...
View Answer

Correct Answer
verified

Correct Answer
verified
D

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified