Select the best term for each definition below.       Definitions Terms a. Shareholders can lose no more than the amount they invest in the company.   b. Corporate earnings are taxed twice—at the corporate level and individual shareholder level.   c. Like an S corporation, but there are no limitations on the number of owners as in an S corporation.   d. Traces the line of authority within the corporation.   e. Allows for legal treatment as a corporation, but tax treatment as a partnership.   f. Has stock traded on a stock exchange such as the New York Stock Exchange (NYSE).   g. The first time a corporation issues stock to the public.   h. Describes (a) the nature of the firm’s business activities, (b) the shares to be issued, and (c) the composition of the initial board of directors.

1. It refers to the capital of a corporation that cannot be withdrawn until final liquidation.  2. Those who compose the corporation whether shareholders or members or both.  3. This occurs when there is a change in the capital structure of the entity.  4. The residual interest of owners in the net assets of a corporation. 5. It is the earmarking of retained earnings for a certain purpose which may be legal, contractual or voluntary.  choices:

An S corporation avoids taxes at   a.  none of the choices.     b.  the corporate level.     c.  the market level.     d.  the shareholder level

Which of the following characteristics best describes a corporation?  a. A business with a single owner b. Is not taxed c. Stockholders not personally liable for entity’s debts d. Not a separate taxable entity

Why would a creditor of a corporation consider suing shareholders of that corporation for a debt owed by the corporation to the creditor?A. The corporation has gone out of business.B. The debt is for a lot of money.C. The shareholder is usually liable for the corporation’s debts.D. The creditor had a contract with the corporation.

If the assets of a corporation are not sufficient to satisfy the claims of its creditors, the creditors can make claims against the personal assets of the owners. True or False The owners of a corporation are personally responsible for the debts of the corporation. True or False

46. Which of the following is not one of the advantages of organizing a business as a corporation? The ability to raise capital is perhaps easiest when organized as a corporation. b. The dividends paid to owners of a corporation are exempt from federal, state, and local taxes. c. The liability of owners of a corporation is limited to the amount they invested in the business. d. Transferring ownership of a business is by far the easiest within the corporate form of business organization. a. ftho following is an example of a direct cost an organization might incur in producing a pro

10. As a legal entity, a corporation can perform the following functions EXCEPT: A. voteB. borrow money, lend money, sue and be sued, and vote.C. borrow money and lend money.D. borrow money, lend money, and sue and be sued. 13. A corporation, potentially, has infinite life because it A. has the same ownership and management.B. is a legal entity.C. is closely regulated.D. has limited liability.

Which of the following is an advantage of a corporation? ANSWER O O O O The earnings of a corporation are not taxed. Transfer of corporation ownership is easy. Startup costs for a corporation are less expenses than other business forms. Stockholders have unlimited liability. I DON'T KNOW YET