13) The principle of limited liability means: a) creditors cannot seize corporate assets b) that the corporations liability to creditors is limited to the amount of paid up capital c) a shareholder can lose no more than what he has paid for his shares in the event that creditors seize the corporations assets d) none of the above

13) The principle of limited liability means: a) creditors cannot seize corporate assets b) that the corporations liability to creditors is limited to the amount of paid up capital c) a shareholder can lose no more than what he has paid for his shares in the event that creditors seize the corporations assets d) none of the above

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter6: Corporations: Redemptions And Liquidations

Section: Chapter Questions

Problem 3BCRQ

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Similar questions

Which of the following statements is false? A) In bankruptcy, management is given the opportunity to reorganize the firm and renegotiate with debt holders. B) Because a corporation is a separate legal entity, when it fails to repay its debts, the people who lent to the firm, the debt holders are entitled to seize the assets of the corporation in compensation for the default. C) As long as the corporation can satisfy the claims of the debt holders, ownership remains in the hands of the equity holders. D) If the corporation fails to satisfy debt holders' claims, debt holders may lose control of the firm.
In every corporate liquidation, which type of credits will not share from the free assets of the corporation? * a. Unsecured claims without priority b. Partially secured claims c. Fully secured claims d. Unsecured claims with priority
A corporation may not deduct dividends paid to shareholders but is permitted to deduct reasonable compensation? True or False
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
T2. stock holders are not liable for a corporation's actions or debt true or false
True or False. a corporation is cease to exist when its shareholders sell their stock.
The dividend is not a legal liability until the board of directors has declared it. true or false. Explain why?
11 Which of the following events will be considered to be a disposal for capital gains tax purposes (1) The selling of shares in a subsidiary (ii) Expropriation of property (iii) The transfer of an asset due to failure to pay debt (iv) The granting of an option by a company to acquire a share in it (v) The obtaining of any credit from a person
When a corporation is dissolved due to fraud, graft, and corruption, can innocent employees and stockholders have claims over the asset of the corporation after satisfying all its liabilities?
What is a disadvantage of the corporate form? Profit O Revenue Owners have very little influence on business decisions O Limited liability
Which of the following liquidating dividend is not legal? a. Liquidating dividend of a continuing merchandising corporation b. Liquidating dividend of a mining corporation c. Liquidating dividend of a wasting asset corporation d. Liquidating dividend of a corporation at the state of bankruptcy
Corporations disclose restrictions of retained earnings on the balance sheet as a deduction from retained earnings. in the notes to the financial statements. as a liability on the balance sheet. on a voluntary basis; it is not required.