Question 1

Which of the following business organization is legally considered a separate person and offers limited liability to its owners?

		A corporation.
		A sole proprietorship consists of a husband and wife.
		A sole proprietorship.
		A general partnership.

Question 2

What is the most likely result if a corporate promoter signs contracts in the name of the corporation, but the corporation was not legally formed at the time?

		Only the corporation will be liable for the contracts.
		The persons who signed stock subscription agreements with the corporation will be personally liable for the contracts.
		The promoter will be personally liable for the contracts.
		No one will be liable for the contracts.

Question 3

Which of the following activities within a corporation can lead to the piercing of the corporate veil and holding the shareholders liable for the corporation's debts?

		Commingling of funds between the shareholders and the corporation.
		Shareholders bringing a lawsuit in the name of the corporation for breaches of fiduciary duty on the part of the Board of Directors.
		Officers of the corporation being involved in self-dealing in violation of their fiduciary duties to the corporation.

Question 4

Which of the following securities provides an ownership interest in a corporation?

		An unsecured loan to the corporation by a bank.
		A corporate bond.
		A corporate debenture.
		Common shares in the corporation.

Question 5

Which of the following is an accurate statement of corporate governance?

		One continues in business and the other is suspended, pending liquidation.
		The corporation owes a fiduciary duty to the members of the Board of Directors.
		Both corporations continue to exist, but one may only act as a holding company.

Question 1

Which of the following business organization is legally considered a separate person and offers limited liability to its owners?

		A general partnership.
		A corporation.
		A sole proprietorship.
		A sole proprietorship consists of a husband and wife.