1. Martin and Van are officers of Buren Information Corporation. As corporate officers, the rights of Martin and Van are
a. the same as those held by the corporate directors.
b. determined by their employment contracts.
c. specified in state corporation statutes.
d. the same as those held by the corporate shareholders.
2. The right to inspect corporate books and records is
a. held only by directors.
b. held by shareholders, but the right is limited to the inspection and copying of corporate books and records for a proper purpose, and the request to inspect the books must be made in advance.
c. never available to shareholders
d. a virtually absolute right of shareholders and cannot be restricted.
3 William and Leon, as shareholders in McKinley office Supplies, Inc., are issued stock certificates by the firm. If Leon loses his certificates
a. ownership of the stock is forfeited, and the shares revert to McKinley's treasury
b. ownership of the stock is not affected because ownership rights exist independently of the certificate.
c. a new certificate cannot be issued to replace it.
d. the finder of the certificate assumes ownership of the stock.
4. Shares are referred to as watered stock if they are
a. issued by the corporation for less than their stated value.
b. no-par shares.
C, transferred in violation of a shareholders' stock-transfer agreement.
d. subject to stock warrants.
5. Junior is a director of Massachusetts Manufac~ring Corporation. Which of the followi?}g is not an automatic right of Junior, as a director?
a. Participation
b. Inspection of books
C. Compensation
d. None of the above
6. George is a director of Washington Corporation. Which of the following describes George's position with regard to Washington?
a. Agent
b. Principal
c. Fiduciary
d. Trustee
7. A shareholder's derivative suit is a suit brought
a. by a shareholder or shareholders on behalf of the corporation when the directors fail to undertake any action to redress a wrong suffered by the corporation.
b. by the directors against a majority shareholder who has breached his or her fiduciary duty to the corporation or to minority shareholders.
c. against a majority shareholder by a third party who was harmed by the corporate decision approved of, and voted for, by the shareholder.
d. by a shareholder who is also a director of the corporation being sued.
8. A corporation may indemnify a director for legal costs, feest and judgments involved in defending corporation-related suits in
a. most states but not under the Revised Model Business Corporation Act.
b. most states and under the Revised Model Business Corporation Act.
c. only a few states.
d. no states
9. Which of the following funds are available in all states for payment of dividends?
a. Retained earnings
b. Accumulated surplus
c. Net profits
d. Gross profits
10. All corporations issue
a. bonds.
b. common stock.
c. preferred stock.
d. bonds, common stock, and preferred stock.