What Was the Main Rule That Was Established in Lee

question 15

Multiple Choice

What was the main rule that was established in Lee v Lee's Air Farming Ltd (1961) ?

• A)A company is separate from the person who controls it.
• B)A person who was the main shareholder and director of a company could also be an employee of the company.
• C)A person cannot escape liability by hiding behind the 'corporate veil'.
• D)A director who takes no part in the daily business of the company may be liable for debts it incurs when it was insolvent.

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Definitions:

Weighted Average

A calculation that takes into account the varying degrees of importance of the numbers in a data set, giving more weight to some numbers than others.

Free Cash Flow

This refers to the amount of cash a company generates after accounting for cash outflows to support operations and maintain its capital assets. It is an important indicator of financial health.

Price Per Share

The current market value of a company's shares, determined by dividing the total market capitalization of the company by its number of outstanding shares.

Notes Payable

Short or long-term liabilities; a written promise to pay a specified amount of money, known as the principal, along with interest, by a certain date.