Which of the Following Is a Consequence of a Corporation

question 47

Multiple Choice

Which of the following is a consequence of a corporation being a separate entity from its owners?​

• A)The owners are not personally responsible for the obligations of a company.
• B)The articles of incorporation are not required to set up a corporation.
• C)A corporation cannot enter into binding contracts in its name.
• D)The death or withdrawal of an owner dissolves a corporation.

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Definitions:

Negligent

The failure to take reasonable care to avoid causing injury or loss to another person, resulting in legal liability for the resulting damages.

Reasonably Foreseeable

A legal standard referring to events or consequences that a person should anticipate as likely to happen under certain circumstances.

Generally Accepted Auditing Standards

Principles that provide a framework for auditors to conduct financial audits, ensuring accuracy, consistency, and verifiability.

Negligence

A failure to exercise the care that a reasonably prudent person would exercise in similar circumstances, leading to harm or damage.