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Ashorn Ashorn
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6 years ago
Jim incorporated his small business so that he would obtain limited liability on company indebtedness. But when he applied for a bank loan, the bank insisted that he give a personal guarantee for the loan made to the corporation. Has the incorporating of the business helped Jim as far as limiting his business liability?
a. No, it has not, since all venders and creditors will be more leery about extending credit.
b. Yes, it has, because it might help in other types of liability, such as product liability.
c. No, it has not, because bankers become more cautious when they see individuals incorporate just to avoid personal liability.
d. No, it has not, because personal guarantees are required either way.
e. Yes, it has, because the bank has more confidence in issuing his company the loan.
Textbook 
The Law and Business Administration in Canada

The Law and Business Administration in Canada


Edition: 14th
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Existence87Existence87
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Ashorn Author
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#2
6 years ago
Came right on time, ty so much!
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