1. Which of the following grants absolute limited liability?

A. Sole Proprietorship.

B. Partnership.

C. Limited Partnership.

D. Corporation.

2. “Piercing the corporate veil” becomes appropriate whenever:

A. A de jure corporation exists.

B. The corporation business is treated so carelessly that the corporation and its shareholders are no longer separate entities.

C. A close corporation exists.

D. When a federal agency comes to examine the financial records and the inventory.

3. When a creditor is permitted to collect a debt by taking a portion of someone’s wages, this is called:

A. Skimping.

B. Garnishment.

C. Attachment.

D. Not possible.

4. A new type of corporation that not only seeks to make a profit but also tries to take actions which will have a positive impact on the public as well is called:

A. P.C. Corporation.

B. S. Corporation.

C. Benefit Corporation.

D. Close Corporation

5. David and Emily are officers of Fresh Bottled Water Corporation. As top corporate officers, their compensation is determined by Fresh Bottled Waters:

A. Directors.

B. Incorporators.

C. Other officers.

D. Shareholders.

6. David is not Edward’s agent but enters into a contract with Frank on Edward’s behalf. Edward later contacts Frank to affirm the contract. This is:

A. An agency by agreement.

B. An agency by estoppel.

C. An agency by ratification.

D. An agency by delusion.

7. Stocks that get a preference in receiving a dividend is:

A. Exquisite stock.

B. Payable stock.

C. Common stock.

D. Preferred stock.

8. If a corporation filed for incorporation in Pennsylvania and is conducting business activities in New Jersey, as to New Jersey the corporation is considered to be:

A. An alien corporation.

B. A domestic corporation.

C. A foreign corporation.

D. None of these.

9. Treadwell Tire Manufacturing Company employs Simon as an agent. To terminate Simon’s authority, Treadwell must give actual notice to:

A. Only third parties who are aware of the agency relationship.

B. Simon and any third parties who are aware of the agency relationship.

C. Simon only.

D. The public generally