Question 1

A limited partner who takes an active part in managing a limited partnership ________.

Accepted Answer

A)  will lose the right to receive profit distributions as a limited partner 
B)  will be entitled to reasonable compensation for the value of the managerial services provided 
C)  will be treated as a general partner and is liable only to parties who reasonably believe that he or she is a general partner 
D)  will be treated as a general partner and liable to all parties with whom he or she transacts business affairs 
A)  will lose the right to receive profit distributions as a limited partner 
B)  will be entitled to reasonable compensation for the value of the managerial services provided 
C)  will be treated as a general partner and is liable only to parties who reasonably believe that he or she is a general partner 
D)  will be treated as a general partner and liable to all parties with whom he or she transacts business affairs

Question 2

Forming a sole proprietorship is easy and does not cost a lot.

Accepted Answer

A) True 
 B)False

Question 3

The surviving general partners who have not engaged in any wrongdoing have the right to wind up the partnership.

Accepted Answer

A) True 
 B)False

Question 4

Instead of suing the partnerships or other partners at law,general partners are given the right to bring a(n)________ against other partners.

Accepted Answer

A)  claim for damages 
B)  tort action 
C)  call for action 
D)  action for an accounting 
A)  claim for damages 
B)  tort action 
C)  call for action 
D)  action for an accounting

Question 5

How is a general partnership formed? Analyze the criteria for a business to qualify as a general partnership under the Uniform Partnership Act.

Accepted Answer

A business must meet four criteria to qu

Question 6

The agreement to form a general partnership must always be in writing.

Accepted Answer

A) True 
 B)False

Question 7

It is good practice to establish voting rights in a limited partnership agreement or certificate of limited partnership.

Accepted Answer

A) True 
 B)False

Question 8

General partnerships that exist for more than one year must be in writing under the Statute of Frauds.

Accepted Answer

A) True 
 B)False

Question 9

A limited liability limited partnership is required to have at least ________.

Accepted Answer

A)  two limited partners 
B)  one general partner, and two limited partners 
C)  one general partner, and one limited partner 
D)  two general partners 
A)  two limited partners 
B)  one general partner, and two limited partners 
C)  one general partner, and one limited partner 
D)  two general partners

Question 10

Which of the following statements is true about the formation of a general partnership?

Accepted Answer

A)  The most important factor in determining coownership is whether the parties share the business's profits and management responsibility. 
B)  Nonpartners of a partnership concern are usually given the right to share in a business's profits. 
C)  The right to participate in the management of a business is conclusive evidence of the existence of a general partnership. 
D)  An agreement to share losses of a business is not a compelling evidence of the existence of a general partnership. 
A)  The most important factor in determining coownership is whether the parties share the business's profits and management responsibility. 
B)  Nonpartners of a partnership concern are usually given the right to share in a business's profits. 
C)  The right to participate in the management of a business is conclusive evidence of the existence of a general partnership. 
D)  An agreement to share losses of a business is not a compelling evidence of the existence of a general partnership.

Question 11

Limited partners actively participate in the management of the partnership concern.

Accepted Answer

A) True 
 B)False

Question 12

________ is a situation in which a partner withdraws from a partnership without having the right to do so at that time.

Accepted Answer

A)  Winding up 
B)  Indemnification 
C)  Wrongful dissolution 
D)  Proliferation 
A)  Winding up 
B)  Indemnification 
C)  Wrongful dissolution 
D)  Proliferation

Question 13

Which of the following statements is true about the liability of partners in a limited partnership?

Accepted Answer

A)  The general partners of a limited partnership have limited personal liability for the debts and obligations of the limited partnership. 
B)  The liability of general partners extends to debts that cannot be satisfied with the existing capital of the limited partnership. 
C)  Limited partners are personally liable for the debts and obligations of the limited partnership. 
D)  A corporation as a general partner has an unlimited liability to the shareholders of the company. 
A)  The general partners of a limited partnership have limited personal liability for the debts and obligations of the limited partnership. 
B)  The liability of general partners extends to debts that cannot be satisfied with the existing capital of the limited partnership. 
C)  Limited partners are personally liable for the debts and obligations of the limited partnership. 
D)  A corporation as a general partner has an unlimited liability to the shareholders of the company.

Question 14

Which of the following is true of the management of a general partnership?

Accepted Answer

A)  The number of votes a general partner has depends on the proportion of his or her capital investment. 
B)  Partnership matters are decided by unanimous agreement only. 
C)  Only general partners in the board of directors have the authority to participate in the management. 
D)  If the vote is tied, the action being voted on is considered to be defeated. 
A)  The number of votes a general partner has depends on the proportion of his or her capital investment. 
B)  Partnership matters are decided by unanimous agreement only. 
C)  Only general partners in the board of directors have the authority to participate in the management. 
D)  If the vote is tied, the action being voted on is considered to be defeated.

Question 15

Which of the following statements is true about partners in a limited partnership?

Accepted Answer

A)  Limited partners actively participate in the management of the partnership concern. 
B)  General partners are personally liable for debts in the partnership concern. 
C)  General partners cannot assume the role of limited partners in the partnership concern. 
D)  Limited partners are restricted to not more than thirty in a partnership concern. 
A)  Limited partners actively participate in the management of the partnership concern. 
B)  General partners are personally liable for debts in the partnership concern. 
C)  General partners cannot assume the role of limited partners in the partnership concern. 
D)  Limited partners are restricted to not more than thirty in a partnership concern.

Question 16

Analyze,in brief,the rights of general partners.

Accepted Answer

A partner who makes a loan to the partne

Question 17

A(n)________ is a partnership created with no fixed duration.

Accepted Answer

A)  partnership for a term 
B)  partnership at will 
C)  ordinary partnership 
D)  limited partnership 
A)  partnership for a term 
B)  partnership at will 
C)  ordinary partnership 
D)  limited partnership

Question 18

Which of the following statements is true of a limited partnership?

Accepted Answer

A)  The creation of a limited partnership involves an informal procedure. 
B)  The creation of a limited partnership should be kept confidential and not disclosed to the public. 
C)  A person cannot be both a general partner and a limited partner in the same limited partnership. 
D)  A limited partnership agreement cannot waive the right of partners to approve the admission of new general partners. 
A)  The creation of a limited partnership involves an informal procedure. 
B)  The creation of a limited partnership should be kept confidential and not disclosed to the public. 
C)  A person cannot be both a general partner and a limited partner in the same limited partnership. 
D)  A limited partnership agreement cannot waive the right of partners to approve the admission of new general partners.

Question 19

Which of the following statements is true in the creation of a general partnership?

Accepted Answer

A)  The business name has to have the names of all the partners. 
B)  The business name cannot be a fictitious name. 
C)  The name selected by the partnership cannot indicate that it is a corporation. 
D)  The business cannot operate under a trade name. 
A)  The business name has to have the names of all the partners. 
B)  The business name cannot be a fictitious name. 
C)  The name selected by the partnership cannot indicate that it is a corporation. 
D)  The business cannot operate under a trade name.

Question 20

Which of the following statements is true about a corporation being a general partner in a limited partnership?

Accepted Answer

A)  A corporation can be a general partner in a limited partnership, but only if it is not the sole general partner. 
B)  A corporation can be a general partner in a limited partnership, even if it is the only general partner. 
C)  A corporation can be a general partner in a limited partnership, but only if another corporation is a limited partner. 
D)  A corporation can be a general partner in a limited partnership, but only if there is at least two or more general partners. 
A)  A corporation can be a general partner in a limited partnership, but only if it is not the sole general partner. 
B)  A corporation can be a general partner in a limited partnership, even if it is the only general partner. 
C)  A corporation can be a general partner in a limited partnership, but only if another corporation is a limited partner. 
D)  A corporation can be a general partner in a limited partnership, but only if there is at least two or more general partners.

Exam 26: Small Business, Entrepreneurship, and Partnerships

A limited partner who takes an active part in managing a limited partnership ________.

Forming a sole proprietorship is easy and does not cost a lot.

The surviving general partners who have not engaged in any wrongdoing have the right to wind up the partnership.

Instead of suing the partnerships or other partners at law,general partners are given the right to bring a(n)________ against other partners.

How is a general partnership formed? Analyze the criteria for a business to qualify as a general partnership under the Uniform Partnership Act.

The agreement to form a general partnership must always be in writing.

It is good practice to establish voting rights in a limited partnership agreement or certificate of limited partnership.

General partnerships that exist for more than one year must be in writing under the Statute of Frauds.

A limited liability limited partnership is required to have at least ________.

Which of the following statements is true about the formation of a general partnership?

Limited partners actively participate in the management of the partnership concern.

________ is a situation in which a partner withdraws from a partnership without having the right to do so at that time.

Which of the following statements is true about the liability of partners in a limited partnership?

Which of the following is true of the management of a general partnership?

Which of the following statements is true about partners in a limited partnership?

Analyze,in brief,the rights of general partners.

A(n)________ is a partnership created with no fixed duration.

Which of the following statements is true of a limited partnership?

Which of the following statements is true in the creation of a general partnership?

Which of the following statements is true about a corporation being a general partner in a limited partnership?

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