Chapter 8

Question 1

Corp is governed by?

Answer 1

Laws of state organized in and jurisdictions it does business in

Question 2

MBCA

Answer 2

Model business corporation act

Question 3

articles of incorporation

Answer 3

Provides basic info about and is needed to create the corporation

Question 4

Bylaws

Answer 4

Its own internal rules for operation

Question 5

Corporations liability

Answer 5

Can be civilly liable for torts of its agents, officers, employees

Question 6

Ultra vires doctrine

Answer 6

Going beyond the powers/scope of a corporation

Question 7

Benefit corporation

Answer 7

Formed under state statute, combined profit making with social good

Question 8

Close corporation

Answer 8

A corporation whose shares are held by a small group, acts informally

Question 9

Professional corporation

Answer 9

Organized by prof, doctors, etc

Question 10

Stock certificate

Answer 10

Doc that represents ownership in a corporation

Question 11

Franchise tax

Answer 11

Tax imposed by a state for privilege of doing business there

Question 12

Section 1244 stock

Answer 12

Stock upon the sale of which (at a loss) receives favorable tax treatment and is taxed as an ordinary loss

Question 13

Qualified small business stock

Answer 13

Stock of certain corporations upon the sale of which (at a gain) receives favorable tax treatment

Question 14

Advantages of a corporation

Answer 14

Limited liability, raise capital, business deductions, ease of transferability, continuity

Question 15

Disadvantages of corporation

Answer 15

Double tax, formalities, centralized management