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Fundamentals of Ethics, Corporate Governance and Business Law Questions and Answers

Question 85

You work for a company that designs and manufactures children's toys. Which of the following is NOT an example of social responsibility that your company might choose to address?

Options:

The use of chemicals in manufacturing

The welfare of workers who assemble the company's products

The environmental impact of transporting toys from the country of manufacture to the country of sale

Whether the recommended retail price of a particular product provides sufficient margin after the unit cost of production is taken into account

Question 86

Adam, Brian, Charles and David each held 25% of the issued share capital of ABCD Ltd. Adam has recently issued further shares to himself in order to increase his voting power. Which of the following is incorrect?

Options:

The share issue is automatically invalid.

The shareholders may ratify the share issue by ordinary resolution.

The shareholders may challenge the validity of the share issue using Section 994 of the Companies Act 2006, on the ground that the issue is "unfairly prejudicial to the interests of the shareholders".

The company may proceed against Adam for breach of fiduciary duty.

Question 87

Which of the following is correct?

(i) A contract for the sale of land must be in writing.

(ii) A consumer credit agreement must be in writing.

(iii) A contract of employment must be in writing.

Options:

(i) only

(i) and (ii) only

(i) and (iii) only

(i), (ii) and (iii)

Question 88

An auditor would trace copies of sales invoices lo shipping documents in order to check for which of the following errors?

Options:

Goods which have been invoiced have not been sent to customers

Goods which were sent to customers have not been recorded in the individual customer's ledger account

Goods which have been invoiced have not been recorded in the sales ledger.

Goods sent to customers have not been invoiced

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Fundamentals of Ethics, Corporate Governance and Business Law Questions and Answers

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