Majority shareholder of burien widgets corporation

Assignment Help Operation Management

Reference no: EM131635805

Albert is a director and the majority shareholder of Burien Widgets Corporation. Albert buys, for $2,500, an option to purchase a tract of real estate for $70,000. Albert forms a new corporation, Albert’s Investments, Inc., to hold the option. As the majority shareholder, and thus controlling director, of Burien Widgets, Albert orders Burien Widgets to authorize the purchase of the land from Albert’s Investments for $500,000. Albert then has Albert’s Investments buy the land and sell it to Burien Widgets, and loan the money to Burien Widgets for the purchase at a 20 percent interest rate. Donald, a minority shareholder in Burien Widgets, complains to Burien’s board, which takes no action. Donald files a suit against Albert on Burien Widget’s behalf. Will Donald prevail? Please fully explain your answer and support it with at least one example. You must provide an example to receive all the possible points for this question.

Reference no: EM131635805

Questions Cloud

Incentives to cheat on these cooperative agreements : Just as there are incentives to cooperate in strategic alliances, there are also incentives to cheat on these cooperative agreements.

Why is pestle analysis so crucial to marketing managers : Why is PESTLE analysis so crucial to marketing managers? How does your firm use PESTLE to plan strategy?

Business organization would be most appropriate : Which form of business organization would be most appropriate?

Processes are being considered for making new product : Two manufacturing processes are being considered for making a new product

Majority shareholder of burien widgets corporation : Albert is a director and the majority shareholder of Burien Widgets Corporation. Donald files a suit against Albert on Burien Widget’s behalf.

Would apple benefit from hybrid or matrix structure : What type of organizational structure is Apple currently using? Would Apple benefit from a hybrid or matrix structure? Why or why not

Consumers to interact with self-service technologies : One of the major changes in consumer behaviour is the growing tendency of consumers to interact with self-service technologies.

How teachers nurture young children language development : Explain how teachers nurture young children's language development.

Review the consumer product safety act : Review the Consumer Product Safety Act. Do you think these laws increase or decrease a company’s liability?

User Account

All Pages