WASHINGTON STATE UNIVERSITY (WSU) MBA
5300 EXAM PRACTICE QUESTIONS WITH
CORRECT ANSWERS
A filing document, which includes rules made by the founders of a corporation
like the directors election process, terms of the positions, stockholder rules, &
procedures to amend the bylaws, etc. What is this document called? --
ANSWER--Corporate Bylaws
Businesses in the form of corporations offer their owners several advantages,
but the benefits come at a price. For instance, corporations are required to create
a charter, set bylaws, and file mandatory reports with state and federal
authorities, which can get expensive and time consuming.
The filing document, which requires the company to state: (1) the name of the
proposed corporation, (2) types of activities the company will be involved in,
(3) amount of capital stock, (4) number of directors, and (5) names and
addresses of the directors, is called the corporate ___. --ANSWER--Charter
The owners of a corporation are ___. The primary objective of the corporate
management team is to ___ by ___ over the long run. --ANSWER--the
shareholders of the company
maximize the shareholders' wealth
Page 1 of 23
,maximizing the fundamental price of the company's common stock
Businesses can be classified into the following forms: a proprietorship, a
partnership, a corporation, a limited liability company (LLC), and a limited
liability partnership (LLP).
Different forms of businesses have different characteristics. Which of the
following characteristics would apply to a corporation? Check all that apply. --
ANSWER--Chartered by a state and is its own entity separate from its owners
Owners have limited liability
Has unlimited life
Easier to transfer ownership in the form of stock
Businesses can be classified into the following forms: a proprietorship, a
partnership, a corporation, a limited liability company (LLC), and a limited
liability partnership (LLP).
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, Different forms of businesses have different characteristics. Which of the
following characteristics would apply to a limited liability company and a
limited liability partnership? Check all that apply. --ANSWER--Have corporate
ownership structure
Owners have limited liability and right to vote
Limited financial liability
Taxed as a partnership
Ryan started a tutoring website. After a few months, a publishing company filed
a lawsuit against his company for copyright infringement. Ryan had to shut
down his business and lost all his personal assets in the process. What type of
business is this? --ANSWER--Proprietorship
Richard founded and operated a wedding planning agency, which specialized in
celebrity weddings. When he died, his business was dissolved because there
was no plan for control after his death. --ANSWER--Proprietorship
Purple consulting has 5 consultants in the firm. The company's annual revenue
is around 500k. Income is distributed among all consultants and each is
personally liable for claims if the company goes under. What type of business is
this? --ANSWER--Partnership
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5300 EXAM PRACTICE QUESTIONS WITH
CORRECT ANSWERS
A filing document, which includes rules made by the founders of a corporation
like the directors election process, terms of the positions, stockholder rules, &
procedures to amend the bylaws, etc. What is this document called? --
ANSWER--Corporate Bylaws
Businesses in the form of corporations offer their owners several advantages,
but the benefits come at a price. For instance, corporations are required to create
a charter, set bylaws, and file mandatory reports with state and federal
authorities, which can get expensive and time consuming.
The filing document, which requires the company to state: (1) the name of the
proposed corporation, (2) types of activities the company will be involved in,
(3) amount of capital stock, (4) number of directors, and (5) names and
addresses of the directors, is called the corporate ___. --ANSWER--Charter
The owners of a corporation are ___. The primary objective of the corporate
management team is to ___ by ___ over the long run. --ANSWER--the
shareholders of the company
maximize the shareholders' wealth
Page 1 of 23
,maximizing the fundamental price of the company's common stock
Businesses can be classified into the following forms: a proprietorship, a
partnership, a corporation, a limited liability company (LLC), and a limited
liability partnership (LLP).
Different forms of businesses have different characteristics. Which of the
following characteristics would apply to a corporation? Check all that apply. --
ANSWER--Chartered by a state and is its own entity separate from its owners
Owners have limited liability
Has unlimited life
Easier to transfer ownership in the form of stock
Businesses can be classified into the following forms: a proprietorship, a
partnership, a corporation, a limited liability company (LLC), and a limited
liability partnership (LLP).
Page 2 of 23
, Different forms of businesses have different characteristics. Which of the
following characteristics would apply to a limited liability company and a
limited liability partnership? Check all that apply. --ANSWER--Have corporate
ownership structure
Owners have limited liability and right to vote
Limited financial liability
Taxed as a partnership
Ryan started a tutoring website. After a few months, a publishing company filed
a lawsuit against his company for copyright infringement. Ryan had to shut
down his business and lost all his personal assets in the process. What type of
business is this? --ANSWER--Proprietorship
Richard founded and operated a wedding planning agency, which specialized in
celebrity weddings. When he died, his business was dissolved because there
was no plan for control after his death. --ANSWER--Proprietorship
Purple consulting has 5 consultants in the firm. The company's annual revenue
is around 500k. Income is distributed among all consultants and each is
personally liable for claims if the company goes under. What type of business is
this? --ANSWER--Partnership
Page 3 of 23
