Question 1

Which of the following is correct with regard to partnership property?

Accepted Answer

A)  Like partnership capital, it is a fixed amount set forth in the articles of partnership. 
B)  Under the RUPA, there is a rebuttable presumption that unless a contrary intention appears, property acquired with partnership funds is partnership property. 
C)  The RUPA sets forth two irrebuttable presumptions that apply when the partners did not express their intent, one of which is that property acquired in the name of one of the partners without an indication of her capacity as a partner and without use of partnership funds is presumed to be that partner's separate property. 
D)  If there is no express agreement whether property owned by a partner before formation of the partnership and used in the partnership business is an asset of the partnership, the fact that taxes, liens, and expenses have been paid by the partnership is irrelevant. 
A)  Like partnership capital, it is a fixed amount set forth in the articles of partnership. 
B)  Under the RUPA, there is a rebuttable presumption that unless a contrary intention appears, property acquired with partnership funds is partnership property. 
C)  The RUPA sets forth two irrebuttable presumptions that apply when the partners did not express their intent, one of which is that property acquired in the name of one of the partners without an indication of her capacity as a partner and without use of partnership funds is presumed to be that partner's separate property. 
D)  If there is no express agreement whether property owned by a partner before formation of the partnership and used in the partnership business is an asset of the partnership, the fact that taxes, liens, and expenses have been paid by the partnership is irrelevant.

Question 2

No minimum amount of capitalization is necessary before a partnership may commence business.

Accepted Answer

A) True 
 B)False

Question 3

A partner's transferable interest is subject to the claims of that partner's creditors who may obtain a judicial lien known as a(n) __________ against the partner's transferable interest.

Accepted Answer

A)  foreclosure 
B)  redemption 
C)  charging order 
D)  None of these. 
A)  foreclosure 
B)  redemption 
C)  charging order 
D)  None of these.

Question 4

The type of business enterprise with the most entities is the sole proprietorship, followed by the corporation; but the type of business enterprise with the greatest total revenue generation per year is the corporation.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following is the most convincing evidence of a partnership arrangement?

Accepted Answer

A)  Two or more persons are co-owners of property used in a business. 
B)  Two or more persons have a written agreement regarding a fundraiser for charity. 
C)  Two or more persons carry on a business for profit, but they have no formal agreement. 
D)  Two person share a joint savings account in which they deposit money and share the interest. 
A)  Two or more persons are co-owners of property used in a business. 
B)  Two or more persons have a written agreement regarding a fundraiser for charity. 
C)  Two or more persons carry on a business for profit, but they have no formal agreement. 
D)  Two person share a joint savings account in which they deposit money and share the interest.

Question 6

Ed, Vivian, and Pablo enter a partnership. Identify the source of the duties among the partners and whether these can be waived or varied. Name the principal duties Ed, Vivian, and Pablo have to each other and to the partnership.

Accepted Answer

The partnership agreement and statutes a

Question 7

Which of the following is NOT an advantage of a partnership?

Accepted Answer

A)  Partners' income taxes may be less than the income taxes would be on a corporation. 
B)  Each partner has limited liability. 
C)  It is possible to bring together more managerial skills than in a sole proprietorship. 
D)  It is possible to bring together more capital than in a sole proprietorship. 
A)  Partners' income taxes may be less than the income taxes would be on a corporation. 
B)  Each partner has limited liability. 
C)  It is possible to bring together more managerial skills than in a sole proprietorship. 
D)  It is possible to bring together more capital than in a sole proprietorship.

Question 8

A __________ is an unincorporated business association consisting of at least one general partner and at least one limited partner.

Accepted Answer

A)  joint venture 
B)  limited liability company 
C)  limited liability partnership 
D)  limited partnership 
A)  joint venture 
B)  limited liability company 
C)  limited liability partnership 
D)  limited partnership

Question 9

Partners may elect whether or not the partnership will be taxed as a separate entity.

Accepted Answer

A) True 
 B)False

Question 10

General partnerships are used frequently in finance, insurance, accounting, real estate, law, and other services.

Accepted Answer

A) True 
 B)False

Question 11

A judicial lien against a partner's transferable interest in a partnership is known as:

Accepted Answer

A)  a legal aggregate. 
B)  a delegation of assets. 
C)  a charging order. 
D)  an assignment. 
A)  a legal aggregate. 
B)  a delegation of assets. 
C)  a charging order. 
D)  an assignment.

Question 12

States have authorized the formation of limited liability companies.

Accepted Answer

A) True 
 B)False

Question 13

A partner's fiduciary duty under the UPA differs in some respects from that under the RUPA.

Accepted Answer

A) True 
 B)False

Question 14

Michelle and Margaret agree to form a partnership. The partnership contract between Michelle and Margaret does not have to be in writing in order to be enforceable in the courts.

Accepted Answer

A) True 
 B)False

Question 15

A general partnership is formed without any formality and no documents need be filed with the state.

Accepted Answer

A) True 
 B)False

Question 16

The law establishes a test for determining whether a partnership has been formed. The test includes which of the following?

Accepted Answer

A)  An association of two or more persons. 
B)  Conducting a business not necessarily for profit. 
C)  That the partnership agreement is filed with the Secretary of State. 
D)  The sharing of gross returns. 
A)  An association of two or more persons. 
B)  Conducting a business not necessarily for profit. 
C)  That the partnership agreement is filed with the Secretary of State. 
D)  The sharing of gross returns.

Question 17

In choosing the form in which to conduct business, if ease of formation is the primary concern, the owners would choose a:

Accepted Answer

A)  corporation. 
B)  limited liability partnership. 
C)  limited partnership. 
D)  general partnership. 
A)  corporation. 
B)  limited liability partnership. 
C)  limited partnership. 
D)  general partnership.

Question 18

The RUPA cannot be modified by agreement of the partners to a partnership. Its provisions must be strictly followed in any partnership agreement.

Accepted Answer

A) True 
 B)False

Question 19

A charitable organization cannot be formed as a partnership.

Accepted Answer

A) True 
 B)False

Question 20

General partners differ from limited partners only in the amount of input they have in partnership decisions.

Accepted Answer

A) True 
 B)False

Exam 30: Formation and Internal Relations of General Partnerships

Which of the following is correct with regard to partnership property?

No minimum amount of capitalization is necessary before a partnership may commence business.

A partner's transferable interest is subject to the claims of that partner's creditors who may obtain a judicial lien known as a(n) __________ against the partner's transferable interest.

The type of business enterprise with the most entities is the sole proprietorship, followed by the corporation; but the type of business enterprise with the greatest total revenue generation per year is the corporation.

Which of the following is the most convincing evidence of a partnership arrangement?

Ed, Vivian, and Pablo enter a partnership. Identify the source of the duties among the partners and whether these can be waived or varied. Name the principal duties Ed, Vivian, and Pablo have to each other and to the partnership.

Which of the following is NOT an advantage of a partnership?

A __________ is an unincorporated business association consisting of at least one general partner and at least one limited partner.

Partners may elect whether or not the partnership will be taxed as a separate entity.

General partnerships are used frequently in finance, insurance, accounting, real estate, law, and other services.

A judicial lien against a partner's transferable interest in a partnership is known as:

States have authorized the formation of limited liability companies.

A partner's fiduciary duty under the UPA differs in some respects from that under the RUPA.

Michelle and Margaret agree to form a partnership. The partnership contract between Michelle and Margaret does not have to be in writing in order to be enforceable in the courts.

A general partnership is formed without any formality and no documents need be filed with the state.

The law establishes a test for determining whether a partnership has been formed. The test includes which of the following?

In choosing the form in which to conduct business, if ease of formation is the primary concern, the owners would choose a:

The RUPA cannot be modified by agreement of the partners to a partnership. Its provisions must be strictly followed in any partnership agreement.

A charitable organization cannot be formed as a partnership.

General partners differ from limited partners only in the amount of input they have in partnership decisions.

Introduction to Law

Business Ethics

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

Introduction to Sales and Leases

Performance

Transfer of Title and Risk of Loss

Product Liability: Warranties and Strict Liability

Sales Remedies

Form and Content

Transfer and Holder in Due Course

Liability of Parties

Bank Deposits, Collections, and Funds Transfers

Relationship of Principal and Agent

Relationship With Third Parties

Operation and Dissolution of General Partnerships

Limited Partnerships and Limited Liability Companies

Nature and Formation of Corporations

Financial Structure of Corporations

Management Structure of Corporations

Fundamental Changes of Corporations

Secured Transactions and Suretyship

Bankruptcy

Securities Regulation

Intellectual Property

Employment Law

Antitrust

Accountants Legal Liability

Consumer Protection

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 Wills

Filters