Exam 4

Question 1

Officers in a corporation typically include all of the following except:

• social director
• president
• secretary
• treasurer

Answer 1

social director

Question 2

In the funeral home, an example of a general agent would be the
FDIC
limo driver
embalming service
visitation attendent

Answer 2

FDIC

Question 3

An agent who is authorized to carry out all of a principal’s business of a particular kind or at a given location is called the ________ agent; and an agent who has limited power of authority to carry out only a specific act for the principal is called the ______ agent.

special; universal
broker; factor del credere
general; special
broker; general

Answer 3

general; special

Question 4

A party who agrees to work for another party for pay is called a/an

Answer 4

employee

Question 5

A principle making good losses of the agent and holding them harmless in actions related to the agent fulfilling their duties is termed:

Answer 5

indemnification

Question 6

An agency relationship may be terminated by:

1. bankruptcy of the agent
2. dissolution of the corporation
3. illegality of the subject matter and/or subsequent agreement
4. death or incapacity of either the agent or the principal

Answer 6

all 4 of these

Question 7

Which of the following is NOT a cause for dissolution of a partnership operation?

• death of a partner
• insanity of a partner
• excess profit
• bankruptcy of the partnership

Answer 7

excess profit

Question 8

An entity which is distinct and separate apart from the existence of its owners is one definition of a/an:

Answer 8

corporation

Question 9

Which of the following is NOT a duty of an employee to the employer?

• faithful and honest performance
• maintaining confidentiality
• perform and skill
• disobedience

Answer 9

disobedience

Question 10

Written authorization allowing one to vote for another when a stockholder will be absent from a corporate meeting is called a/an

Answer 10

proxy

Question 11

Which of the following could bring about the dissolution of a partnership, as discussed in class?

• marriage of one of the partners
• death of one of the partners
• one of the partners moving to another city
• divorce of one of the partners

Answer 11

death of one of the partners

Question 12

A person or firm under contract to do a job, but who is NOT subject to the direction and control of the other party, is called an

Answer 12

independent contractor

Question 13

Owners in a corporation are called

Answer 13

shareholders

Question 14

One party who engages another party to work for pay is called an

Answer 14

employer

Question 15

The name of the document which contains the terms of agreement between partners is the

Answer 15

partnership agreement

Question 16

Which of the following is NOT a characteristic of a sole proprietorship business?

• the owner receives all of the profits
• the proprietor has no personal liability
• the simplest form of business organization
• the owner assumes all losses

Answer 16

the proprietor has no personal liability

Question 17

The simplest form of business organization is the

Answer 17

sole proprietorship

Question 18

A relationship in which one person represents another party in making contracts is called a/an

Answer 18

agency

Question 19

The _____ are selected by the board of directors and are responsible for carrying out the board’s policies.

Answer 19

officers

Question 20

The partner who has his/her liability for the firm’s debts limited to the amount of his/her investment is called the

Answer 20

limited partner

Question 21

A partner who is liable only to the extent of his/her investment in the business is called the ____; and a partner who has full and personal liability is called the ____.

Answer 21

limited partner; general partner

Question 22

Proportional shares of corporate profits paid to the stockholders are called

Answer 22

dividends

Question 23

When a corporation has been given authority to exist as an entity by a state government, the corporation is said to be

Answer 23

chartered

Question 24

Which of the following is NOT a duty of one partner to another?

• loyalty and good faith
• reasonable care and skill in conducting business practice
• conform to the partnership agreement
• remain silent

Answer 24

remain silent

Question 25

A body elected by the stockholders to establish policies for a corporation is the

Answer 25

board of directors

Question 26

In an agency relationship, the party who appoints another person to make contracts for and on his/her behalf is called the _______; and the party who is appointed to represent another person in making contracts is called the_______.

Answer 26

principal; agent

Question 27

A relationship in which one person represents another in making contracts with third parties is called a/an

Answer 27

agency

Question 28

A person or firm under contract to do a job, but who is not subject to the other party's direction and control, is called a/an

Answer 28

independent contractor

Question 29

Another name for shareholders is

Answer 29

stockholder

Question 30

Rights of stockholders include all of the following EXCEPT: - receive stock certificates - vote at corporate meetings - receive dividends - sacrifice their vote if unable to attend a corporate meeting

Answer 30

sacrifice their vote if unable to attend a corporate meeting

Question 31

Which of the following would a general agent most likely NOT be able to do for a principal? - sign a contract which binds the principal - buy goods on behalf of the principal - vote in a general election of behalf of the principal - manage a business on behalf of the principal

Answer 31

vote in a general election of behalf of the principal

Question 32

In an agency relationship, the party who appoints another to make contracts for and on behalf of him/her is called the

Answer 32

principal

Question 33

In an agency, the party who is authorized to make contracts for, and on behalf of, another party is called the

Answer 33

agent

Question 34

An agent who is authorized to carry out all of a principal's business of a particular kind or at a given location is called a/an

Answer 34

general agent

Question 35

An agent who has limited power of authority, or is authorized to carry out only a specific act or acts, is called a/an

Answer 35

special agent