Question 1

Juan and Barbara form a limited liability company to conduct a particular business activity for profit.Which of the following is not true?

Accepted Answer

A) The articles of organization must be filed in a designated state office. 
B) No particular form of organization is required. 
C) The company name must include the words "limited liability company" or "limited company" or the abbreviation "LLC" or "LC." 
D) The contribution of a member may be a promissory note. 
A) The articles of organization must be filed in a designated state office. 
B) No particular form of organization is required. 
C) The company name must include the words "limited liability company" or "limited company" or the abbreviation "LLC" or "LC." 
D) The contribution of a member may be a promissory note.

Question 2

Foreign limited partnerships do not have to operate in another country.

Accepted Answer

A) True 
 B)False

Question 3

A limited partner's financial obligation to the partnership may be increased if the:

Accepted Answer

A) limited partner acts as agent for a competing partnership. 
B) limited partner takes active part in the management of the partnership. 
C) another limited partner is added to the partnership. 
D) All of these are true. 
A) limited partner acts as agent for a competing partnership. 
B) limited partner takes active part in the management of the partnership. 
C) another limited partner is added to the partnership. 
D) All of these are true.

Question 4

If the partnership agreement does not specify when a limited partner may withdraw or specify a definite time for the limited partnership's dissolution, a limited partner may withdraw upon giving at least one month's written notice to each general partner.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following is true of limited liability companies?

Accepted Answer

A) Most states limit the duration of LLCs. 
B) In most states, LLCs must file annual reports with the state. 
C) The contribution of a member to a limited liability company must be cash or property. 
D) A written operating agreement governing all of the relations between members is required in all states. 
A) Most states limit the duration of LLCs. 
B) In most states, LLCs must file annual reports with the state. 
C) The contribution of a member to a limited liability company must be cash or property. 
D) A written operating agreement governing all of the relations between members is required in all states.

Question 6

Kimberly contributed $50,000 as a limited partner in a limited partnership.Upon dissolution of the partnership, the priorities in distributing the assets are to:

Accepted Answer

A) creditors of the partnership, partners and ex-partners in satisfaction of liabilities for unpaid distributions, partners for return of contributions, and to partners for their partnership interests in the proportions in which they share in distributions. 
B) creditors of the partnership, partners for return of contributions, partners and ex-partners in satisfaction of liabilities for unpaid distributions, and partners for their partnership interests in equal shares. 
C) creditors of the partnership, partners for their partnership interests, partners for return of contributions to the partnership, and ex-partners for liability for unpaid distributions. 
D) partners for return of contributions, outside creditors of the partnership, partners for their partnership interests, and partners and ex-partners for unpaid distributions. 
A) creditors of the partnership, partners and ex-partners in satisfaction of liabilities for unpaid distributions, partners for return of contributions, and to partners for their partnership interests in the proportions in which they share in distributions. 
B) creditors of the partnership, partners for return of contributions, partners and ex-partners in satisfaction of liabilities for unpaid distributions, and partners for their partnership interests in equal shares. 
C) creditors of the partnership, partners for their partnership interests, partners for return of contributions to the partnership, and ex-partners for liability for unpaid distributions. 
D) partners for return of contributions, outside creditors of the partnership, partners for their partnership interests, and partners and ex-partners for unpaid distributions.

Question 7

Which of the following is true with respect to a defective formation of a limited partnership?

Accepted Answer

A) The formation is defective if the certificate filed does not substantially meet statutory requirements. 
B) It jeopardizes the limited liability of a limited partner. 
C) The 1985 RULPA reduces the risk of a limited partner for defective formation. 
D) All of these are correct. 
A) The formation is defective if the certificate filed does not substantially meet statutory requirements. 
B) It jeopardizes the limited liability of a limited partner. 
C) The 1985 RULPA reduces the risk of a limited partner for defective formation. 
D) All of these are correct.

Question 8

A limited partner may vote on the sale of all of the assets of the limited partnership or a change in the nature of the business without being deemed to have taken part in control of the business.

Accepted Answer

A) True 
 B)False

Question 9

Under all LLC statutes, a unanimous vote of the members must be obtained to approve a merger.

Accepted Answer

A) True 
 B)False

Question 10

Upon dissolution, unlike a general partner, a limited partner can get his capital back before general creditors are paid.

Accepted Answer

A) True 
 B)False

Question 11

Unless otherwise provided in the LLC's operating agreement, a member may assign his financial interest in the LLC
without dissolving the LLC.

Accepted Answer

A) True 
 B)False

Question 12

In states where limited liability limited partnerships (LLLPs) are available, a limited partnership may register as an
LLLP without having to form a new organization.

Accepted Answer

A) True 
 B)False

Question 13

Under the 1985 Act, the limited partner need not be named in the limited partnership certificate.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is false with respect to the distribution of assets following dissolution of a limited liability company?

Accepted Answer

A) Most statutes provide default rules for distributing the assets. 
B) Generally, assets are distributed first to creditors, including members and managers who are creditors, except with respect to liabilities or distributions. 
C) Generally, assets are distributed to members and former members in satisfaction of liabilities for unpaid distributions after distributions are made to creditors, including members and managers who are creditors. 
D) Generally, assets are distributed first to creditors who are not members or managers. 
A) Most statutes provide default rules for distributing the assets. 
B) Generally, assets are distributed first to creditors, including members and managers who are creditors, except with respect to liabilities or distributions. 
C) Generally, assets are distributed to members and former members in satisfaction of liabilities for unpaid distributions after distributions are made to creditors, including members and managers who are creditors. 
D) Generally, assets are distributed first to creditors who are not members or managers.

Question 15

Adrianne may form a limited liability company by filing articles of organization in a designated state office, even if she is the only member of the company.

Accepted Answer

A) True 
 B)False

Question 16

Statutes or the common law impose duties of good faith and fair dealing on all members of an LLC whether the LLC
is manager managed or member managed.

Accepted Answer

A) True 
 B)False

Question 17

RULPA requires a lesser duty of care by a general partner to a general partnership than that owed by a general partner to a limited partnership.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following need NOT be included in the certificate filed by a limited partnership under the RULPA?

Accepted Answer

A) The name of the limited partnership 
B) The name and address of the agent for service of process 
C) The names of each of the limited partners 
D) The name and business address of each general partner 
A) The name of the limited partnership 
B) The name and address of the agent for service of process 
C) The names of each of the limited partners 
D) The name and business address of each general partner

Question 19

All states except one have adopted either the 1976 or 1985 RULPA.

Accepted Answer

A) True 
 B)False

Question 20

O'Houlihan and seven of his associates decide to form a limited partnership to operate an office complex.This business must be formed in accordance with the:

Accepted Answer

A) common law of partnerships. 
B) Uniform Commercial Code. 
C) Federal Partnership Act. 
D) None of these. 
A) common law of partnerships. 
B) Uniform Commercial Code. 
C) Federal Partnership Act. 
D) None of these.

Exam 32: Limited Partnerships and Limited Liability Companies

Juan and Barbara form a limited liability company to conduct a particular business activity for profit.Which of the following is not true?

Foreign limited partnerships do not have to operate in another country.

A limited partner's financial obligation to the partnership may be increased if the:

If the partnership agreement does not specify when a limited partner may withdraw or specify a definite time for the limited partnership's dissolution, a limited partner may withdraw upon giving at least one month's written notice to each general partner.

Which of the following is true of limited liability companies?

Kimberly contributed $50,000 as a limited partner in a limited partnership.Upon dissolution of the partnership, the priorities in distributing the assets are to:

Which of the following is true with respect to a defective formation of a limited partnership?

A limited partner may vote on the sale of all of the assets of the limited partnership or a change in the nature of the business without being deemed to have taken part in control of the business.

Under all LLC statutes, a unanimous vote of the members must be obtained to approve a merger.

Upon dissolution, unlike a general partner, a limited partner can get his capital back before general creditors are paid.

Unless otherwise provided in the LLC's operating agreement, a member may assign his financial interest in the LLC without dissolving the LLC.

In states where limited liability limited partnerships (LLLPs) are available, a limited partnership may register as an LLLP without having to form a new organization.

Under the 1985 Act, the limited partner need not be named in the limited partnership certificate.

Which of the following is false with respect to the distribution of assets following dissolution of a limited liability company?

Adrianne may form a limited liability company by filing articles of organization in a designated state office, even if she is the only member of the company.

Statutes or the common law impose duties of good faith and fair dealing on all members of an LLC whether the LLC is manager managed or member managed.

RULPA requires a lesser duty of care by a general partner to a general partnership than that owed by a general partner to a limited partnership.

Which of the following need NOT be included in the certificate filed by a limited partnership under the RULPA?

All states except one have adopted either the 1976 or 1985 RULPA.

O'Houlihan and seven of his associates decide to form a limited partnership to operate an office complex.This business must be formed in accordance with the:

Introduction to Law

Business Ethics and the Social Responsibility of Business

Civil Dispute Resolution

Constitutional Law

Administrative Law

Criminal Law

Intentional Torts

Negligence and Strict Liability

Introduction to Contracts

Mutual Assent

Conduct Invalidating Assent

Consideration

Illegal Bargains

Contractual Capacity

Contracts in Writing

Third Parties to Contracts

Performance, Breach, and Discharge

Contract Remedies

Relationship of Principal and Agent

Relationship With Third Parties

Introduction to Sales and Leases

Performance

Transfer of Title and Risk of Loss

Products Liability: Warranties and Strict Liability in Tort

Sales Remedies

Form and Content

Transfer and Holder in Due Course

Liability of Parties

Bank Deposits, Collections, and Funds Transfers

Formation and Internal Relations of General Partnerships

Operation and Dissolution of General Partnerships

Nature, Formation, and Powers

Financial Structure

Management Structure

Fundamental Changes

Secured Transactions and Suretyship

Bankruptcy

Protection of Intellectual Property

Antitrust

Consumer Protection

Employment Law

Securities Regulation

Accountants Legal Liability

Environmental Law

International Business Law

Introduction to Property, Property Insurance, Bailments, and Documents of Title

Interests in Real Property

Transfer and Control of Real Property

Trusts and Decedents Estates

51: The Legal Environment Of Business

52: Contracts.

53: Agency.

54: Sales

55: Negotiable Instruments

56: Unincorporated Business Association

57: Corporations

58: Debtor and Creditor Relation

59: Regulation of Business

60: Property.