chapter 2

Question 1

is a legal entity created by an individual or group of shareholders who have
ownership of the corporation( through shares of stocks issued by the corporation) to engage in
business activities.

Answer 1

corporation

Question 2

Are legal entities and are sometimes defined as “__________’’. Corporations are allowed to
perform functions that humans make such as

Answer 2

“legal persons”

Question 3

-legal right to produce or sell something that have invented for a specific period of time.

Answer 3

Patents

Question 4

-once registered, that same symbol or series of words cannot be used by any other
organization.

Answer 4

Trademarks

Question 5

And engaging in any business activities
It has indefinite life span that can survive from generation to generation

Answer 5

trademarks

Question 6

entity- a company or organization that has legal rights and responsibilities. i.e. the right to
make contracts and the responsibility to pay debts.

Answer 6

legal entity

Question 7

• is a responsible being in the eyes of the law and can be used for damages if the performance
  of the agreement is not met.

Answer 7

legal entity

Question 8

There is no minimum number of incorporators( directors)
But shall not have more than 20 incorporators

Answer 8

philippine corporation

Question 9

Each of the incorporators must have one share of stocks.

Answer 9

philippine corporation

Question 10

• Granted a perpetual corporate term( previously 50- year term)

Answer 10

philippine corporation

Question 11

• No Required subscribe/ paid-up capital and residency of incorporators
  to keep with global standards.

Answer 11

philippine corporation

Question 12

allows a single person to form a
corporation without board of directors or shareholders

Answer 12

*One Person Corporation (OPC)

Question 13

is the system of rules ,practices and
processes by which a firm is directed and controlled.

Answer 13

Corporate governance

Question 14

governance essentially involves balancing the interests of a
company’s many stakeholders, such as shareholders, senior
management executives, customers, suppliers, financiers, the
government, and the community.

Answer 14

Corporate governance

Question 15

structures were put into place to protect the various stakeholders of corporations and prevent corporate scandals
and or failures from happening.

Answer 15

Corporate governance

Question 16

help guide a company’s decisions and play a big
part in deciding if the business will be successful. It provide a clear direction for
the company and help in setting priorities and goals, as well as making informed
decisions.

Answer 16

• Business aims and objectives

Question 17

provide a clear direction for the company and help in setting priorities and goals,
as well as making informed decisions.

Answer 17

• Business aims and objectives

Question 18

are the broad, general goals that summarize what a company
wants to achieve

Answer 18

• Business aims

Question 19

are specific, measurable targets that help a company achieve its aims.

Answer 19

• Business objectives

Question 20

defines the organization’s business, its objectives and how it will reach these objectives

Answer 20

Mission statement

Question 21

-outlines the company’s long-term goals and aspirations for
the future in terms of its long-term growth and impact on the world

Answer 21

• Vision Statement

Question 22

*Objectives give the business a clearly defined target.

Answer 22

BUSINESS OBJECTIVES

Question 23

These are Plans that can then be made to achieve
targets.

Answer 23

BUSINESS OBJECTIVES

Question 24

• This can motivate the employees.

Answer 24

BUSINESS OBJECTIVES

Question 25

*It also enables the business to measure the progress toward its stated aims.

Answer 25

BUSINESS OBJECTIVES

Question 26

goal is well defined, with a clear outcome in mind it should answer the questions of what you achieve, who is involved, and where it will happen.

Answer 26

specific

Question 27

goal has a clear criteriea for success and a timeline for achieving it. this allows you tu track your progress along the way and

Answer 27

measurable

Question 28

goal is one that is possible to achieve given the resources and constraints you have

Answer 28

achievable

Question 29

goal is one that is achievable and aligned with your overall vision and long term objectives

Answer 29

realistic

Question 30

goal has a clear timeline for completion, with a start and end date. this helps to provide motivation and a sense of urgency to achieve the goal.

Answer 30

time-bound

Question 31

– a short-term object short-trembly for a small business just starting out, or when a new firm enters the market or at a time of crisis.

Answer 31

survival

Question 32

try to make the most profit possible – most like to be the aim of the owners and shareholders.

Answer 32

profit maximization

Question 33

try to make enough profit to keep the owners comfortable – probably the aim of smaller businesses whose owners do not want to work longer hours.

Answer 33

product satisficing

Question 34

where the business tries to make as many sales as possible. This may be because the managers believe that the survival of the business depends on being large. Large businesses can also benefit from economies of scale.

Answer 34

sales growth

Question 35

make a profit of $24,000 by the next financial year. * The objective for this aim would be: make profits of $2,000 for the next 12 months. - increase revenue in the next five years.

Answer 35

financial aim

Question 36

_____________ * Objectives for this aim would be as follows: * Increase product awareness * Acquire new customer * Create or improve digital platform * Increase conversion rate * Reduce overhead costs

Answer 36

financial aim

Question 37

____________________ Become the most sustainable company in the industry. * Objectives for this aim would be as follows: * Use recycled raw materials * Use production methods that reduce CO2 emissions

Answer 37

non-financial aim

Question 38

– organizations like the Co-op or the Body Shop have objectives that are based on their beliefs on how one should treat the environment and people who are less fortunate.

Answer 38

Ethical and socially responsible objectives

Question 39

are run to not only generate a profit but provide a service to the public. This service will need to meet the needs of the less well-off in society or help improve the ability of the economy to function: e.g. cheap and accessible transport service.

Answer 39

Public sector corporations

Question 40

that monitor or control private sector activities have objectives that are to ensure that the business they are monitoring complies with the laws laid down.

Answer 40

Public sector organizations

Question 41

– their objectives are to provide a service – most private schools for instance have charitable status. Their aim is the enhancement of their pupils through education.

Answer 41

Health care and education establishments

Question 42

– their aims and objectives are led by the beliefs they stand for.

Answer 42

Charities and voluntary organizations

Question 43

* A business may achieve an objective and will need to move onto another one (e.g. survival in the first year may lead to an objective of increasing profit in the second year).

Answer 43

Changing Objectives

Question 44

The competitive environment might change, with the launch of new products from competitors.

Answer 44

Changing Objectives

Question 45

Technology might change product designs, so sales and production targets might need to change.

Answer 45

Changing Objectives

Question 46

is the person responsible for leading and managing the entire organization in achieving its organizational goals. It is the duty of the ___________ to collaborate with the board for the overall direction of the company.

Answer 46

CEO (CHIEVE EXECUTIVE ORDERS)

Question 47

the board of directors should not only provide leadership of the board but also play an important role in the governance practices of the company.

Answer 47

Chairman of the Board-

Question 48

- This is the best entity in steering the company’s strategic direction and evaluating its performance. As a director, questions must be asked during board meetings to make sure decisions made by the company will be for the best interest of the company in the long term.

Answer 48

Board of Directors

Question 49

Considered owners of the company through their ownership/ holdings of stock shares, this group actively seeks to maximize stock price increase over a period of time.

Answer 49

Shareholders

Question 50

- Any group of people who are affected by how a corporation operates (i.e., employees, suppliers, government and society among others).

Answer 50

Stakeholders

Question 51

Are individuals who have no connection with the company and are free from any relationship which may be considered a conflict of interest

Answer 51

Independent director

Question 52

Are individuals who are not part of the management but related to a certain aspect of the company, such as being a supplier, family representative, friend, adviser or shareholder

Answer 52

Non-executive director

Question 53

Hold a particular executive position inside the organization, such as CEO or other senior executive position such as the vice president.

Answer 53

Executive director

Question 54

is managed by directors and officers. Directors act as a group known as a board of directors. Corporations also have officers who are appointed by and receive their powers from the board.

Answer 54

corporation

Question 55

- usually makes decisions on corporate policy and operations.

Answer 55

PRESIDENT

Question 56

- assumes the president’s function in his or her absence. Also often be responsible for running part of the corporation’s business or operations.

Answer 56

VICE PRESIDENT

Question 57

makes and keeps the corporate books and records. This includes keeping the records of directors’ and shareholders’ meetings and the corporation’s stock record book. The secretary also has the authority to send out notices to corporate meetings and keep a register of the names and addresses of the stakeholders. The secretary also keeps the corporate seal

Answer 57

SECRETARY-

Question 58

keeps the corporation’s money and is responsible for taxes, financial reports, etc.

Answer 58

treasurer

Question 59

are formed because board work can be done effectively. By focusing and discussing particular issues separately from general board meetings, the timenmanagement of directors is optimized.

Answer 59

the committee / committees

Question 60

Note: It is advisable and recommended that the chairman of these committees be independent directors so that they truly perform their oversight roles according to the requirements of the regulating bodies.

Answer 60

the committee / committees

Question 61

as a result of corporate meltdowns, this committee has become a nonnegotiable aspect of good governance. The main objective of this committee is to oversee accounting and financial reporting processes and results. They make sure that internal and external audits are carried out with integrity.

Answer 61

audit committee

Question 62

this committee is responsible for identifying compensation and benefit plans for directors and senior executives through performance appraisals. Excessive compensation packages during economic downturns or financial crises warrant a closer investigation of the rationale behind said compensation.

Answer 62

remuneration committee

Question 63

to assure an effective working board, the directors on board must be independent thinkers, including executive directors. The ____________ committee should nominate the right mix of board members to ensure objectivity, independence, and expertise.

Answer 63

nomination committee

Question 64

Note: other committees can be formed by the board as part of good governance but this will depend on the need and circumstances of a company.

Answer 64

nomination committee

Question 65

checklist allows you to check your corporation’s compliance with your rule book and the law

Answer 65

HEALTHY CORPORATION CHECKLIST

Question 66

The checklist contains a list of questions to ask about your corporation.

Answer 66

HEALTHY CORPORATION CHECKLIST

Question 67

Each question has a tick box to record your corporation’s compliance, helping you to identify the areas that need attention

Answer 67

HEALTHY CORPORATION CHECKLIST