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Exam 30: Management of a Corporation

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Question 21

True/False

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When directors vote on ordinary issues affecting the corporation, generally a two-thirds majority vote is required.

A) True
B) False

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Question 22

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A board of directors normally can remove corporate officers at any time with or without cause.

A) True
B) False

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Question 23

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Oversight Inc.'s board of directors votes to empower corporate officers to make decisions regarding ordinary, daily corporate affairs within well-defined guidelines. With respect to these affairs, Oversight's board

When directors delegate work to corporate officers, the directors are expected to oversee or supervise that work.

The board of directors hires the corporation's officers.

A corporate director or officer will not be liable to the corporation or to its shareholders for honest mistakes of judgment if the officer or director uses due care.

Rita is an officer of Savor Tea Inc. As a corporate officer, Rita's rights and duties primarily are defined by

Elka is a director and Flynn is an officer of Groundskeeping Inc. Liability for negligence in the performance of duties may extend to

Deb is a director and Erv is an officer of Fast Food Inc. If the company violates environmental laws, liability may extend to

Every corporation is governed by a committee of managerial employees.

Corporate directors or officers will be liable to the corporation or to its shareholders for business decisions that lose the company money even if they are careful in making the decisions.

AstroStar, Inc.'s board of directors consists of three members-Eckhart, Dolan, and Macero. At a regular board meeting, the board selects Galiard as president of the corporation. Later, an audit reveals that during his term as president he has openly embezzled $500,000 from AstroStar. The same audit reveals that the board knew when it selected Galiard that he had been previously convicted of embezzlement. Can the corporation hold directors Eckhart, Dolan, and Macero personally liable?

Freight Dispatch Corporation is a distribution company. Like most corporations, Freight's employees include its

Blue Sky Drones Inc. has three directors, a president, two vice presidents, a secretary, and a treasurer. Carol is a Blue Sky director. In most states, Carol

Chad, Dill, and Eve are the first directors on the board of Face2Face Corporation, a social media host. Subsequent directors are elected by a majority vote of Face2Face's

Risk Insurance Inc. has a board of five directors. Risk's bylaws do not state any quorum requirements. In most states, a quorum for its board meetings would be

Directors can be removed from their position if the shareholders do not re-elect them or during their term for misconduct.

Chief corporate executive officers are personally responsible for the accuracy of financial statements filed with the Securities and Exchange Commission.

The primary function of a corporation's officers is to authorize major corporate policy decisions.

Orin is a corporate officer for Pacific Trade Inc. In this capacity, Orin