Provisions Must Be Recorded If

question 52

Multiple Choice

Provisions must be recorded if:

• A) The future event is unlikely, but the amount can be reliably estimated.
• B) The future event is probable and the amount can be reliably estimated.
• C) The future event is probable, but the amount cannot be estimated.
• D) The future event is unlikely.
• E) All of these answers are correct.

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Definitions:

Business Judgment Rule

A legal principle that protects the decisions made by the board of directors of a corporation as long as those decisions are made in good faith, with due care, and in the best interests of the corporation.

Breach

A breach is the violation or breaking of a law, duty, or obligation, either by engaging in an action that is prohibited or failing to perform a required act.

Fiduciary Duty

A legal obligation of one party to act in the best interest of another when managing financial assets or decisions for them.

Quorum

The minimum number of members that must be present at a meeting to make the proceedings of that meeting valid.