Which of the Following Statements About a Not-For-Profit Firm's Ownership

question 7

Multiple Choice

Which of the following statements about a not-for-profit firm's ownership is most correct?

• A) the residual earnings (profits) of not-for-profit firms can be distributed to the firm's top managers.
• B) not-for-profit firms are exempt from federal taxes, but they must pay state and local taxes, including property taxes.
• C) upon liquidation of a not-for-profit firm, the proceeds from the sale of its assets are distributed, on a pro rata basis, to the firm's employees.
• D) none of the profits are used for private inurement.
• E) not-for-profit firms are governed by a board of trustees whose members are elected by the community at large.

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Definitions:

Defend Against Critics

The action of protecting or justifying something against negative evaluations or objections raised by others.

Crisis Leadership

The capacity to lead and make decisions under extreme pressure or during a crisis, effectively managing and mitigating its impacts.

Micromanage

Micromanage denotes closely controlling or managing someone's work with excessive attention to minor details, often to the detriment of broader objectives.

Transactional Leader

A leadership style that focuses on the execution of tasks and projects through a system of rewards and penalties based on performance.