Because ______ corporations have a more restricted range of powers than business corporations, actions not authorized by their corporate charters are more likely to be found ______.

Question

Quizplus · Accepted Answer

Nonprofit corporations have a more restricted range of powers than business corporations, as they are formed to serve a specific charitable or social purpose rather than to generate profits. Actions not authorized by their corporate charters are more likely to be found ultra vires or beyond their legal authority. Subchapter S corporations are a type of business corporation that passes through their income to their shareholders, and professional corporations are formed by individuals who provide professional services, such as doctors or lawyers. While both types of corporations may have restrictions on their powers, nonprofit corporations are specifically designed for charitable purposes, which limits their range of actions.

Because ______ Corporations Have a More Restricted Range of Powers