Which of the Following Statements Is True About the Board

question 46

Multiple Choice

Which of the following statements is true about the Board of Directors?

• A) The Board members are directly elected by the employees of the company.
• B) The Board has no legal authority to hire, fire, and compensate the CEO.
• C) Some of the Board members hold positions on the boards of several companies.
• D) The Board has no power to nominate people for positions in management.
• E) Divisional and functional managers usually form the Board.

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Definitions:

Fixed Price

A pricing strategy where the cost of a good or service is not subject to change based on varying conditions such as market demand or costs of production.

Purchase Obligation

A commitment to buy goods or services under specified conditions, often including future dates and quantities.

Adjusting Journal Entries

Entries made in the accounting records at the end of an accounting period to allocate income and expenditures to the period in which they actually occurred.

Contingent Loss

A potential financial loss that may occur in the future depending on the outcome of a specific event, often recognized in financial statements once the loss is deemed probable and the amount can be reasonably estimated.