Question

Lily wants to build a business. She has very little capital. She does, however, have a partner with which she could run a business. Lily wants to be able to avoid being held personally liable for any problems the business has. Which of the following would lead Lily to choose a sole proprietorship organization for her business?

Little capital Possession of a partner Avoidance of personal liability None of the above

J-Chron's board of directors periodically meets with the CFO of the company. The CFO reports on the financial status of a company project, after which the board inquires about the project's compliance with legally-required accountings principles. It asks no other questions about the project. Which of the following is true?

The board is meeting all of its vigilance requirements. The board is not meeting any basic vigilance requirements. The board is meeting legally-required vigilance standards, but not necessarily those which would protect shareholders' interest. The board is not legally required to meet vigilance requirements.

Sandy works for RigorMart. She supervises regional managers and directs them based on orders from the board of directors. Sandy’s position also entitles her to stock ownership in the company. What is Sandy’s position in the company?

Executive, shareholder, and director Executive and shareholder Executive Shareholder

Answer 1

1.avoidance of personal liability

2.The board is meeting legally-required vigilance standards, but not necessarily those which would protect shareholders' interest.

3.Executive,shareholder and director