Quiz Ch 01 – T/F Avoiding Double Taxation in Corporate Form
Fundamentals of Financial Management, Concise
Brigham and Houston
09th Edition
True or False: Does the corporate form of organization provide an advantage by preventing double taxation?
True or False: Does the corporate form of organization provide an advantage by preventing double taxation?
True or False: In a corporation, the board of directors holds the highest authority, the chairman of the board is the highest-ranking individual, and a person can serve as both CEO and chairman of the board.
True or False: The likelihood of a firm being organized as a corporation increases as its capital requirements grow.
True or false? Does organizing as a corporation facilitate capital raising due to limited personal liabilities for stockholders in case of bankruptcy and the greater ease of transferring shares compared to partnership interests?
True or False: In most corporations, does the CFO hold a position subordinate to the CEO?
True or False: Creating a corporation is usually cheaper than establishing a proprietorship due to the extensive legal documents necessary for a proprietorship.
True or False: Can partners within a partnership have distinct rights, privileges, and responsibilities from each other?
True or false? To optimize value for its shareholders collectively (rather than specific ones), a firm’s board of directors should create an executive compensation structure that emphasizes the firm’s long-term value.
True or false? According to the book’s definition of equilibrium for a stock, its market price should surpass its intrinsic value.
True or false? Numerous forms of unethical business conduct exist. One instance involves executives furnishing knowingly inaccurate information to banks and shareholders. Providing such information to banks is illegal, but doing so to stockholders, who are the firm’s owners, is not illegal since they are insiders.