Patsy possesses twenty-four acres of remote, rugged land. Patsy has the right to use the
property, in-cluding extracting silver from an existing mine, for life. Patsy also has the
right to lease the land for a period not to exceed her life. Patsys ownership interest is
a. a fee simple absolute.
b. a leasehold estate.
c. a life estate.
d. the power of eminent domain.
As a joke, Jem takes Kylas business law textbook and hides it so that Kyla cannot find
it during the week before the exam. Jem may have committed
a. appropriation.
b. conversion.
c. disparagement of property.
d. trespass to personal property.
A corporate director is an “owner of the corporation
a. True
b. False
China violates an international law. Other countries may take coercive actions, which
include
a. violating the same law in the same way with impunity.
b. confiscatingChinese businesses.
c. boycottingChinese goods.
d. taxingChinese citizens.
Social media users can post trademarked images or copyrights materials without
infringing the owners rights, even if it is done without permission.
a. True
b. False
Willy deposits $5,000 with Home State Bank on July 1, 2012. Home State Bank
promises to repay Willy the $5,000 plus 3 percent annual interest on July 1, 2017.
Home State Bank has issued Willy a
a. certificate of deposit.
b. cashiers check.
c. trade acceptance.
d. draft.
WiFi Corporation, a U.S. firm, signs a contract with Bueno Computadores, Ltd., an
Argentinean firm, for a shipment and payment for WiFis goods. This is
a. a distribution agreement.
b. a joint venture.
c. direct exporting.
d. licensing.
A right can be assigned even if the assignment will significantly alter the risks or duties
of the obligor.
a. True
b. False
Under the Electronic Signatures in Global and National Commerce Act, a signature may
not be denied legal effect solely because it is in electronic form.
a. True
b. False
A provision in the California state constitution conflicts with a provision in the U.S.
Constitution. If challenged
a. neither provision will be enforced.
b. the provisions will be balanced to reach a compromise.
c. the state provision, not the U.S. Constitution, will be enforced.
d. the U.S. Constitution, not the state provision, will be enforced.
Private offerings of securities in unlimited amounts can be exempt from the registration
requirement of the Securities Act of 1933.
a. True
b. False
Accountants may be subject to criminal penalties for violations of federal securities
laws.
a. True
b. False
A law that restricts people of a certain national origin from doing something will be
carefully examined to make sure it promotes a compelling government interest before it
is allowed to stand.
a. True
b. False
Craig is an accountant whose clients include Digby Excavation Corporation. Elbert is
Craigs attorney. Under the common law and by statute in many states, working papers
that Craig develops when preparing financial reports for Digby are owned by
a. Craig.
b. Digby.
c. Elbert.
d. no onethe papers must be destroyed immediately after use.
Clive works for Digby Excavation Corporation. While operating a backhoe, Clive
suffers an injury. Clive will be compen-sated under state workers compensation laws
only if
a. he does not have health insurance.
b. he is completely disabled.
c. his injury was accidental.
d. his injury was intentional.
Cumulative voting refers to the accumulation of proposals presented annually for a
shareholders vote.
a. True
b. False
An option contract is created when an offeror promises to hold an offer open for a
specified period of time in return for a payment given by the offeree.
a. True
b. False
Sof Chair Company contracts to deliver 100 chairs to Stuffy Furnishings Store on May
1 for which Stuffy agrees to pay. Sof tells Stuffy on April 15 that delivery will be
delayed until June 1. Stuffy may
a. await performance, sue Sof, or suspend its own performance.
b. only await Sofs performance for a commercially reasonable time.
c. only sue Sof for breach of contract.
d. only suspend its own performance.
Cody is a partner in Delta Accounting Service. Cody can inspect
a. all of Deltas books and records.
b. Deltas books and records only as the firms management permits.
c. Deltas books and records only for a reasonable purpose.
d. Deltas books and records relating to Codys capital contribution only.
Any person who buys preferred stock has priority over a holder of common stock to
payment on the corporations dissolution.
a. True
b. False
Disparate-impact discrimination occurs when a protected class of individuals is
adversely affected by an employers practices, even though they do not appear to be
discriminatory.
a. True
b. False
Flynn, an accountant, helps Grange Supply Company prepare and file a false federal
corporate income tax return. Under the In-ternal Revenue Code, this is
a. a felony punishable by a fine and imprisonment.
b. a felony punishable only by a fine.
c. a misdemeanor punishable only by a fine.
d. a civil violation subject to a liability suit but not a crime.
The key to liability under Section 10(b) of the Securities Exchange Act of 1934 and
SEC Rule 10b-5 is whether undisclosed inside information is material.
a. True
b. False
Yokio, Ltd., and Zeno, S.A., transact an international sale of goods. At the request of
these parties, a court in Portugal resolves a dispute between them. A U.S. court will
most likely honor the judgment
a. if it is consistent with U.S. laws and public policy.
b. if it is consistent with Portuguese laws and public policy.
c. if it does not benefit the U.S. to deny it.
d. under no circumstances.
Auto Maker Components LLC is an employer based in Michigan. Michigan state law
prohibits employers from taking adverse action against an employee or job applicant
based on what the person has posted online. This applies to
a. social media sites.
b. e-mail accounts.
c. cloud storage accounts.
d. all of the choices.
In some states, misdemeanors are punishable by imprisonment for up to ten years.
a. True
b. False
George burns an American flag in his backyard. He films his actions and posts the video
on YouTube.com. Georges actions are
a. expressly prohibited by the U.S. Constitution.
b. protected by the First Amendment of the U.S. Constitution.
c. considered to be a form of treason.
d. illegal in some states.
Wings2Go Corporation fails to hold an organizational meeting. In this circumstance, at
common law Wings2Go is most likely
a. a corporation by estoppel.
b. a de facto corporation.
c. a de jure corporation.
d. ultra vires.
Constitutional safeguards protect the rights of individuals against federal government
actions.
a. True
b. False
Margaret is the top manager of Pecans, Inc. She sets strict ethical standards for all
employees. Margaret, however, often takes some of the companys best nuts and sells
them from her house. The ethical tone at Pecans, Inc. is
a. likely to be good because Margaret has set such strict standards for her employees.
b. not likely to be good because although Margaret sets strict ethical standards for the
other employees, she does not follow them.
c. not related to either Margarets ethical standards or her own unethical behavior.
d. not likely to be good because employees tend to resent strict ethical standards.
Robert enters into a contract with Claire. Claire agrees to paint Roberts living room for
$500. Claire is the
a. obligor.
b. obligee.
c. assignee.
d. assignor.
William is a surety for Jeannies loan from Richard. Richard knows of Williams
existence. When the loan comes due, Jeannie tries to pay Richard, but Richard rejects
the payment. William is
a. released from any obligation on the debt.
b. required to pay the amount of the debt to Richard.
c. required to pay up to half of the amount of the debt to Richard.
d. required to pay the amount of the debt to Jeannie.
Mix-It Concrete Company has the right to enter Nims land and remove the rock from
Nims quarry. This is
a. a fee simple absolute.
b. a license.
c. an easement.
d. a profit.
Wrongfully taking personal property without the owners permission is conversion.
a. True
b. False