Which of the Following Statements Describes the Company Characteristic Termed

question 70

Multiple Choice

Which of the following statements describes the company characteristic termed no mutual agency?

• A)Shares can be readily bought and sold by investors on the open market.
• B)Companies pay income tax on company earnings,and shareholders pay personal income tax on company dividends and gains from sale of shares.
• C)Shareholders are not authorised to sign contracts or make business commitments on behalf of the company.
• D)The liabilities of the company cannot be extended to the personal assets of the shareholder.

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Definitions:

Non-Exchange Transactions

Transactions where an entity receives value without directly giving approximately equal value in exchange, often seen in government and non-profit organizations.

Equity Ownership

Refers to the holding of stock or shares in a company, representing a claim on the company's assets and earnings.

Net Debt

A measure of a company's financial leverage calculated as total debt minus cash and cash equivalents.

Government's Ability

The capacity of a governmental entity to implement its policies and execute its programs effectively.