The Revised Act Permits a Corporation to Purchase, Redeem, or Otherwise

question 19

Multiple Choice

The Revised Act permits a corporation to purchase, redeem, or otherwise acquire its own shares unless:

• A) the corporation's total assets after the distribution would be less than the sum of its total liabilities and the maximum amount that then would be payable for all outstanding shares having preferential rights in liquidation.
• B) the corporation would be unable to pay its debts as they became due in the usual course of its business.
• C) Both of these are correct.
• D) None of these are correct.

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Definitions:

Legal Guidelines

Standards and rules established by legislation that guide behavior and business practices.

Discretionary Responsibilities

Responsibilities that allow individuals or managers to make decisions based on their judgment and assessment of a situation.

Corporate Social Responsibility

A business practice that involves participating in initiatives that benefit society, emphasizing ethical behavior, sustainable operations, and community development.

Ethical Responsibilities

Obligations to act in a morally sound way, considering the well-being of others and the environment in decision-making processes.