To Retain Its Status as a Corporation in Good Standing,a

question 47

Multiple Choice

To retain its status as a corporation in good standing,a corporation must:

• A)pay an annual franchise fee or tax.
• B)hold an annual shareholders' meeting.
• C)pay an annual dividend to shareholders.
• D)hold an annual board of directors' meeting.

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Definitions:

Retained Earnings

The portion of net income that is not distributed to shareholders but instead reinvested in the business or used to pay off debt.

Insurance Expense

The cost incurred by an entity to obtain insurance coverage, recognized as an expense over the period the insurance provides coverage.

Post-Closing Trial Balance

A list of all accounts and their balances after closing entries are made, used to check the balance of debits and credits.

Fees Earned

Income received from providing services, typically recorded when the service is rendered, not when the payment is received.