ETH321TWeek 2 Practice Assignment
1. What is the definition of a foreign corporation?
2. What is the definition of a Subchapter S corporation?
3. Wade and Hunter want to start a business. They have a large amount of capital. They have a good working relationship and believe they will do well sharing management responsibility and in sharing profits. They are happy to be organizing a business together in order to avoid full liability for the business. Which detail(s) of this situation would be most unhelpful toward Wade and Hunter’s decision to organize a general partnership?
4. What is a public corporation?
5. What is a closely-held corporation?
6. Albus wants to build a business. He wants to start the business fast and reach a large customer base, but he only has a small amount of opening capital. He has no partner with whom to form the business. Which of the following is not a valid reason for Albus to choose a sole proprietorship organization for his business?
7. Which of the following is false concerning LLCs?
8. Tawny wants to be involved in a business. She has lots of capital to invest and she wants to be involved in management, but does not want to be exposed to personal liability for losses the business might incur and she does not want to have to pay excessive taxes on her gains. Which form of business would be best for Tawny?
9. Kim wants to be involved in a business but is not sure what type of business to join or create. She has some capital to invest, several years of managing experience, and a good network of potential investors and partners. What role would be best for Kim?
10. Jaden works for LeoHart. He meets with a team to discuss shareholders’ interests and assign managers to run certain parts of the company. What is Jaden’s position in the company?
11. Leo and Josh have a welding business organized as a general partnership. A customer comes into the business seeking a welding contract. Leo agrees to do the work for the customer as a separate project from his business with Josh. Which of the following is true?
12. Del organized his business in Alaska. He does business in both the U.S. and Canada. In Texas, Del’s business would be considered a(n) __________ corporation.
13. What type of franchise would a car dealership typically belong to?
14. Which of the following is true concerning bonds?
15. The primary purpose for a company’s issuance of stocks is:
16. The board of directors for Glenncorp makes an investment in distribution services that ultimately result in a net loss for the company and its shareholders. Shareholders in the company may:
17. Hector is opening a sole proprietorship. Which of the following would not be included in a list of possible steps Hector would take in setting up his business?
18. Reed works for Marimart. He assembles components for consumer products. He also conducts training for new hires at Marimart. Reed additionally purchases stock in the company? What is Reed’s position in the company?
19. Papapop makes a franchise agreement with a bottling factory to sell its product to the company for bottling and subsequent sale. Over the next several years, Papapop steadily demands a higher percentage of the bottler’s profit from sales. Which of the following is true?
20. Chloe is a non-executive supervisor at her company. She directs other employees but has no control of financial information or decision-making responsibilities. She would be responsible for contributing to which of the following areas?
21. Which of the following is not a basic requirement of good corporate citizenship?
22. Under the notion of effective corporate governance, which of the following is not an example of an internal control?
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