45) An owner of a corporation is known as a(n): A) director C) general partner.

Question

45) An owner of a corporation is known as a(n): A) director C) general partner. 45) B) stockholder. D) limited partner 46) Which of the following is normally considered a disadvantags of the corporate form o business? A) Limited life. C) Double taxation of earnings B) Difficult transfer of ownership D) Unlimited liability of owners. 47) A(n) based ethies code defines corporate values; creates a supportive environment, and, stresses shared accountability among employees A) corporate responsibility C) compliance B) integrity D) social 48) The income generated by S corporations: 48) A) is provided to nonprofit organizations, so it is considered a tax-free source of funds. B) is taxed separately from its owners C) passes through to its owners, and each is taxed individually for this income. D) must be reinvested in the business. Owners should not expect dividends. 49) A is two firms combining to form one company. 49 A) leveraged buyout C) merger B) joint tenancy D) tenancy in common 50) A(n) occurs when one company buys the property and obligations of another 50) company. A) hostile takeover C) acquisition B) leveraged buyout D) cooperative

Explanation / Answer

45. Answer: B. stockholder

Explanation: The company stockholders are the ultimate owners of a corporation and they possess the voting rights to elect board members and vote on major decisions. the profits are also shared by the stockholders or shareholders.

46. Answer: C. double taxation of earnings

Explanation: apart from paying taxes on income, the shareholders also pay taxes on the dividends and this leads to double taxation for corporations.

47. Answer: B. integrity

Explanation: Integrity based ethic code tries to make result by creating g a positive environment rather than focusing on punishing the wrong behavior as in compliance based ethics. It tries to promote good through defining corporate values, creating supportive environment and stress shared accountability among employees.

48. Answer: C. passes through its owners and each is taxed individually for this income

Explanation: In S-corporations the income generated passes through the shareholders who are the owners and each owner are taxed separately for their own income and this avoids the disadvantage of double taxation. Apart from income, loss also passes through the shareholders.

49. Answer: C. merger

Explanation: When two companies join together to form a single company, it is called as a merger.

50. Answer: C. acquisition

Explanation: In acquisition, one company purchases the property and assumes the obligation of another. It also occurs when one firm buys a division or subsidiary from another firm.

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