Corporate Finance, 6th Edition, Berk - Test Bank - All Chapters Covered
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Module
Corporate Finance
Institution
Corporate Finance
Test Bank For Corporate Finance, 6th Edition / Corporate Finance Sixth Edition Test Bank by Jonathan Berk / Test Bank Corporate Finance, 6th Edition / Jonathan Berk, Peter DeMarzo, 9780137844906, Test Bank / Corporate Finance 6E Test Bank.
2) Which of the following organization forms for a business does NOT avoid
double taxation?
A) Limited partnership
B) "C" corporation
C) "S" corporation
D) Limited liability company
Answer: B
Diff : 1
Section: 1.1 The Four Types of Firms
Skill: Conceptual
,3) Which of the following organization forms accounts for the most revenue?
A) "S" corporation
B) Limited partnership
C) "C" corporation
D) Limited liability company
Answer: C
Diff : 1
Section: 1.1 The Four Types of Firms
Skill: Conceptual
4) Which of the following organization forms accounts for the greatest
number of firms?
A) "S" corporation
B) Limited partnership
C) Sole proprietorship
D) "C" corporation
Answer: C
Diff : 1
Section: 1.1 The Four Types of Firms
Skill: Conceptual
5) Which of the following is NOT an advantage of a sole proprietorship?
A) Single taxation
B) Ease of setup
C) Limited liability
D) No separation of ownership and control
Answer: C
Diff : 2
Section: 1.1 The Four Types of Firms
,Skill: Conceptual
6) Which of the following statements regarding limited partnerships is
TRUE?
A) There is no limit on a limited partner's liability.
B) A limited partner's liability is limited by the amount of their investment.
C) A limited partner is not liable until all the assets of the general partners
have been exhausted.
D) A general partner's liability is limited by the amount of their investment.
Answer: B
Diff : 2
Section: 1.1 The Four Types of Firms
Skill: Conceptual
7) Which of the following is/are an advantage of incorporation?
A) Access to capital markets
B) Limited liability
C) Unlimited life
D) All of the above
Answer: D
Diff : 2
Section: 1.1 The Four Types of Firms
Skill: Conceptual
8) Which of the following statements is most correct?
A) An advantage to incorporation is that it allows for less regulation of the
business.
B) An advantage of a corporation is that it is subject to double taxation.
, C) Unlike a partnership, a disadvantage of a corporation is that it has limited
liability.
D) Corporations face more regulations when compared to partnerships.
Answer: D
Diff : 2
Section: 1.1 The Four Types of Firms
Skill: Conceptual
9) A limited liability company is essentially:
A) a limited partnership without limited partners.
B) a limited partnership without a general partner.
C) just another name for a limited partnership with a general partner.
D) just another name for a corporation.
Answer: B
Diff : 1
Section: 1.1 The Four Types of Firms
Skill: Conceptual
10) The distinguishing feature of a corporation is that:
A) there is no legal difference between the corporation and its owners.
B) it is a legally defined, artificial being, separate from its owners.
C) it spreads liability for its corporate obligations to all shareholders.
D) it provides limited liability only to small shareholders.
Answer: B
Diff : 2
Section: 1.1 The Four Types of Firms
Skill: Conceptual
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