Exam 42: LPs, LLCs, and LLPs

The partners who manage the limited partnership and are personally liable for the firm debts are called the __________ partners.

Managers of an LLC have the same fiduciary duties to the entity as corporate officers have to a corporation.

Limited partners are personally liable for debts of the business.

Alice, Betty, and Cathy are interested in forming a business venture. Alice is quite wealthy and is ready to contribute money to the venture. Betty has a degree in business from an excellent university, worked for five years as a manager in a major corporation, and currently is a leadership/management consultant. Cathy is a scientist who has developed a process that will, according to her, "revolutionize cancer treatment throughout the world." Alice, Betty, and Cathy believe it is in their best interest to form a general partnership. Do you agree? Is there a more appropriate form of business you might recommend?

The general partner of a limited partnership may be a corporation.

If an owner discloses he is an agent of an LLC, he will not be personally liable for the debts and obligations of the entity.

The rules for dissolution of a limited partnership are the same as those of a general partnership.

If a limited partnership certificate is never filed, all partners are treated as general partners.

Members of a limited liability company share profits:

When no LP certificate is filed, what is the result?

An LLC is a separate legal entity that pays federal income tax.

Under the RULPA, limited partners may engage in certain "safe harbor" activities without losing their protection from liability.