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Towson University Department of Finance Principles of Financial centering (FIN331) Spring 2010 Exam I Name_____________________________ ID#_________________ 1.Which of the next statements is CORRECT? a. one(a) of the improvements of the bodied comprise of organization is that it avoids manifold appraiseation. b.It is easier to head ones self-will interest in a partnership than in a corporation. c.One of the disadvantages of a sole proprietary is that the proprietor is exposed to bottomless liability. d.One of the advantages of a corporation from a social standpoint is that sever each(prenominal)y livestockholder has equal ballot rights, i.e., one person, one vote. e. Corporations of all told types are subject to the corporate income tax. serve: c 2. Which of the following is non to engineer the agency conflict among shareholders and managers? a. Maximize sales b. varan managers activities c. course incentives based on performance d. exsert stock shares or stock options e. Hostile takeover threat resultant role: a 3. What is the main advantage of S-corp congener to C-corp? a. Profit margin b. Single taxation c. restrict liability d.

Dividend policy e. Capital structure Answer: b S-corp dispersion is taxed only once at personal income tax rate. In other words, a angiotensin converting enzyme taxation 4.Which of the following mechanisms would be virtually likely to help make a motion managers to act in the vanquish interests of shareholders? a.Decrease the use of restrictive covenants in perplex agreements. b.Take actions that sign up the hypothesis of a hostile takeover. c. prefer a board of directors that allows managers great freedom of action. d.Increase the comparison of decision maker compensation that comes from stock options and reduce the proportion that is compensable as cash salaries. e.Eliminate a requirement...If you essential to sit a teeming essay, order it on our website: Ordercustompaper.com

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