True or false?
1. A corporation is an entity separate and distinct from its owners.
2. As a legal entity, a corporation has most of the rights and privileges of a person.
3. Most of the largest U. S. corporations are privately held corporations.
4. Corporations may buy, own, and sell property; borrow money; enter into legally binding contracts; and sue and be sued.
5. The net income of a corporation is not taxed as a separate entity.
6. Creditors have a legal claim on the personal assets of the owners of a corporation if the corporation does not pay its debts.
7. The transfer of stock from one owner to another requires the approval of either the corporation or other stockholders.
8. The board of directors of a corporation legally owns the corporation.
9. The chief accounting officer of a corporation is the controller.
10. Corporations are subject to fewer state and federal regulations than partnerships or proprietorships.

1. True

2. True

3. False

4. True

5. False

6. False

7. False

8. False

9. True

10. False

Explanation:

A corporation is an entity that is separate and distinct from its owners. A corporation enjoys some of the rights that individuals possess as they can own assets, enter contracts, sue and be sued, loan and borrow money, hire employees, and pay taxes.

Most of the largest U.S. corporations are publicly held corporations. The net income of a corporation is taxed as a separate entity. When a corporation doesn't fulfill its obligation to pay a debt, the creditors have no legal claim on the personal assets that the owners of a corporation possess.

In the case of transfer of stock.from one person to another, the approval of other stakeholders or corporation is not required. The shareholders are the legal owners of the corporation while the chief accounting officer is the controller.

Corporations are subject to more state and federal regulations than sole proprietorships and partnerships.

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