If a shareholder works for the business then he: a. will become a creditor of th

Question

If a shareholder works for the business then he:
    a. will become a creditor of the corporation and will enjoy the same rights of recovery against the corporation as any other creditor
    b. will not officially become a creditor of the corporation, but will enjoy the same rights of recovery against the corporation as any other creditor
    c. will be removed from the corporation
    d. will be forced to sell his shares in the company
    e. will become a creditor of the corporation, but will not enjoy the same rights of recovery against the corporation as any other creditor

Explanation / Answer

Ans: If a Shareholder works for the business then he will become a creditor of the corporation and will enjoy the same rights of recovery againdt the corporation as any other creditor.

Note: a sharehorder is not required to sell his share since he can deal with the company instead of having the shares of the company. shareholder is different from the creditor and the both of them having different part in company.

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