The Revised Act Explicitly Requires a Corporations's Charter to Authorize

question 31

Multiple Choice

The Revised Act explicitly requires a corporations's charter to authorize:

• A) one or more classes of shares that together are entitled to receive the net assets of the corporation upon dissolution.
• B) one or more classes of shares that have limited voting rights.
• C) Both are correct.
• D) nothing. The Revised Act only recommends, not requires, the charter contents.

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Definitions:

Contribution Margin Ratio

A measurement that shows how much of a company's revenue is available to cover fixed expenses and generate profit after variable costs are covered.

Fixed Costs

Expenses that do not change with the level of goods or services produced by a business, such as rent, salaries, and insurance premiums.

Profit Ratio

A financial metric that measures the amount of profit generated by a business relative to aspects of its operations, such as sales.

Break-even Sales

The amount of revenue required to cover total fixed and variable costs, resulting in a profit of zero.