Fundamentals of Corporate Finance
11th Edition
by Richard A. Brealey
Complete Chapter Test Bank are
included (Ch 1 to 24)
** Immediate Download
** Swift Response
** All Chapters included
,Ch 01 11e
Student name:__________
1) Which one of these is a disadvantage of the corporate form of business?
A) Access to capital
B) Unlimited personal liability for owners
C) Limited firm life
D) Legal requirements
2) Which one of the following gives a corporation its permanence?
A) Multiple owners
B) Limited liability
C) Corporation taxation
D) Separation of ownership and control
3) In a partnership form of organization, income tax liability, if any, is incurred by:
A) the partnership itself.
B) the partners individually.
C) both the partnership and the partners.
D) neither the partnership nor the partners.
4) Which one of the following would correctly differentiate general partners from limited
partners in a limited partnership?
A) General partners have more job experience.
B) General partners have an ownership interest.
C) General partners are subject to double taxation.
D) General partners have unlimited personal liability.
Version 1 1
, Ch 01 11e
5) Which form of organization provides limited liability for the firm but yet allows the
professionals working within that firm to be sued personally?
A) Limited liability partnership
B) Limited liability company
C) Sole proprietorship
D) Professional corporation
6) Which of the following organizations is least likely to use a professional corporation (PC)
structure?
A) Accountants
B) Doctors
C) Lawyers
D) Manufacturers
7) Which of the following is least likely to be discussed in the articles of incorporation?
A) How the firm is to be financed
B) The purpose of the business
C) The price range of the shares of stock
D) How the board of directors is to be structured
8) When a corporation fails, the maximum that can be lost by an individual shareholder is:
A) the amount of their initial investment.
B) the amount of their share of the profits.
C) their proportionate share required to pay the corporation's debts.
D) the amount of their personal wealth.
Version 1 2
11th Edition
by Richard A. Brealey
Complete Chapter Test Bank are
included (Ch 1 to 24)
** Immediate Download
** Swift Response
** All Chapters included
,Ch 01 11e
Student name:__________
1) Which one of these is a disadvantage of the corporate form of business?
A) Access to capital
B) Unlimited personal liability for owners
C) Limited firm life
D) Legal requirements
2) Which one of the following gives a corporation its permanence?
A) Multiple owners
B) Limited liability
C) Corporation taxation
D) Separation of ownership and control
3) In a partnership form of organization, income tax liability, if any, is incurred by:
A) the partnership itself.
B) the partners individually.
C) both the partnership and the partners.
D) neither the partnership nor the partners.
4) Which one of the following would correctly differentiate general partners from limited
partners in a limited partnership?
A) General partners have more job experience.
B) General partners have an ownership interest.
C) General partners are subject to double taxation.
D) General partners have unlimited personal liability.
Version 1 1
, Ch 01 11e
5) Which form of organization provides limited liability for the firm but yet allows the
professionals working within that firm to be sued personally?
A) Limited liability partnership
B) Limited liability company
C) Sole proprietorship
D) Professional corporation
6) Which of the following organizations is least likely to use a professional corporation (PC)
structure?
A) Accountants
B) Doctors
C) Lawyers
D) Manufacturers
7) Which of the following is least likely to be discussed in the articles of incorporation?
A) How the firm is to be financed
B) The purpose of the business
C) The price range of the shares of stock
D) How the board of directors is to be structured
8) When a corporation fails, the maximum that can be lost by an individual shareholder is:
A) the amount of their initial investment.
B) the amount of their share of the profits.
C) their proportionate share required to pay the corporation's debts.
D) the amount of their personal wealth.
Version 1 2
