Jed Wimsey, in Auditing the Books of Various Businesses Around

question 82

Multiple Choice

Jed Wimsey, in auditing the books of various businesses around town, was talking to you, his best friend, about certain practices that he thought improper. Which of the following practices he found would be a breach of fiduciary duty?

• A) A partner of a firm that sold hospital supplies had, without the knowledge or consent of his partners, started a competing business that he ran from his own home.
• B) The directors failed to declare a dividend for the fourth year in a row.
• C) A director of a corporation profited $25,000 from a contract between the corporation and sellers of some property in which the director had an interest, after the director made full disclosure of his interest to the board of directors and abstained from the vote.
• D) An officer of a corporation took advantage of an opportunity he learned about as an officer of the corporation, but took steps to determine that the corporation was not interested in it and received permission to do so from the board of directors.
• E) A shareholder belongs to a group that directly opposes the policy of the corporation with regard to its logging and mining operations.

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Definitions:

Popé

A Tewa religious leader from present-day New Mexico who led a successful revolt against Spanish colonizers in 1680.

Metacom

Also known as King Philip, a Native American leader who waged King Philip's War against the New England colonists in 1675-1676.

Uprisings

Organized instances of rebellion or resistance against authority, often by oppressed groups seeking political, social, or economic change.

Witchcraft Scare

A period of mass hysteria and panic over alleged witchcraft, often leading to trials and executions.