Business Terms: Corporate Law and Business Structures, Quizzes of Business and Labour Law

Download Business Terms: Corporate Law and Business Structures and more Quizzes Business and Labour Law in PDF only on Docsity! TERM 1 business judgment rule DEFINITION 1 rule giving corporate directors and managers immunity from liability when problems result from reasonable, honest mistakes in business judgment TERM 2 bylaws DEFINITION 2 the rules that regulate and govern the internal operations of a corporation with respect to the rights and duties of directors, shareholders, and officers TERM 3 close corporation DEFINITION 3 a corporation with shares held by one or a small group of shareholders; stock is not actively traded TERM 4 corporation DEFINITION 4 an artificial legal entity created under state law for conducting business; it has rights and responsibilities separate from the owners, is entitled to many constitutional protections, and has access to the courts TERM 5 dissolution DEFINITION 5 the process of terminating (ending) a corporation or partnership; may be voluntary or involuntary (if due to bankruptcy or fraud) TERM 6 fiduciary duty DEFINITION 6 a duty to act in good faith for the benefit of others in a shared undertaking; the highest standard of duty implied by law TERM 7 general partnership DEFINITION 7 an association of two or more persons to carry on a business for profit as co-owners; partners share control over operations and profit TERM 8 limited liability company DEFINITION 8 a business organization that is treated like a corporation for liability purposes (shareholders only liable for debts up to the amount they invested in the company) but like a partnership for tax purposes (profits taxed only once, as the earnings of shareholders) TERM 9 limited partnership DEFINITION 9 a business organization made up of partners who agree to carry on a business venture for profit; must have at least one general partner and one or more limited partners; limited partners may not manage the business and are not liable for debts beyond their capital investment TERM 10 partnership DEFINITION 10 a business owned by two or more persons and not organized as a corporation