Question 1

Nina, the owner of Organic Farm, a sole proprietorship, wants to obtain additional capital to operate. This can be accomplished by​

Accepted Answer

A)  ​a bank loan. 
B)  ​a Small Business Administration Loan. 
C)  ​a state grant. 
D)  ​any of the choices. 
A)  ​a bank loan. 
B)  ​a Small Business Administration Loan. 
C)  ​a state grant. 
D)  ​any of the choices. D

Question 2

Carl starts up, and assumes the financial risk of, DataWorks, a new Web marketing enterprise. Carl and DataWorks must meet legal requirements relating to​

Accepted Answer

A)  ​business name and state tax registration. 
B)  ​occupational licensing. 
C)  ​intellectual property laws. 
D)  ​all of the choices. 
A)  ​business name and state tax registration. 
B)  ​occupational licensing. 
C)  ​intellectual property laws. 
D)  ​all of the choices. D

Question 3

Typically, the articles of organization of a limited liability company (LLC) include information on how the LLC will be managed.​

Accepted Answer

A) True 
 B)False  True

Question 4

Beth and Carol want to form a limited liability company to manage their business, DoReMi Music. Their state has adopted the Uniform Limited Liability Company Act, which has been adopted in​

Accepted Answer

A)  ​all states. 
B)  ​no state. 
C)  ​less than one-fifth of the states. 
D)  ​about half of the states. 
A)  ​all states. 
B)  ​no state. 
C)  ​less than one-fifth of the states. 
D)  ​about half of the states.

Question 5

Members of a limited liability company can stipulate in their operating agreement how voting rights will be apportioned.​

Accepted Answer

A) True 
 B)False

Question 6

Fact Pattern 18-1
Bryn, Cornell, and Duke are partners in Equity Lending, a consumer credit, mortgage, and investment firm. Their agreement states that it is a breach of the agreement for any partner to assign his or her interest to a creditor without the consent of the other partners.
-Refer to Fact Pattern 18-1. Bryn, Cornell, and Duke decide to admit Giselle as a new partner in Equity Lending. Giselle's liability for partnership debts incurred before her admission is​

Accepted Answer

A)  ​limited to her capital contribution to the firm. 
B)  ​limited to her personal assets. 
C)  ​nothing. 
D)  ​unlimited. 
A)  ​limited to her capital contribution to the firm. 
B)  ​limited to her personal assets. 
C)  ​nothing. 
D)  ​unlimited.

Question 7

Limited liability company operating agreements can provide whether formal members' meetings will be held.​

Accepted Answer

A) True 
 B)False

Question 8

Any suit against the business or its employees can lead to unlimited personal liability for the owner of a sole proprietorship.​

Accepted Answer

A) True 
 B)False

Question 9

Craig, Donna, and Eve do business as Fast-Track Career Consultants. Eve's relationship to Fast-Track ends, but the firm continues to do business. This is​

Accepted Answer

A)  ​dissociation. 
B)  ​dissolution. 
C)  ​most likely illegal. 
D)  ​unethical. 
A)  ​dissociation. 
B)  ​dissolution. 
C)  ​most likely illegal. 
D)  ​unethical.

Question 10

Luke and Maya form Northeast Air Express, a partnership. The essential elements of this partnership do not include​

Accepted Answer

A)  ​a sharing of profits and losses. 
B)  ​a joint ownership of the business. 
C)  ​an equal right to management in the business. 
D)  ​goodwill. 
A)  ​a sharing of profits and losses. 
B)  ​a joint ownership of the business. 
C)  ​an equal right to management in the business. 
D)  ​goodwill.

Question 11

Chet is a partner in Diligent Accounting Service. Chet can inspect Diligent's books and records​

Accepted Answer

A)  ​in their entirety. 
B)  ​only as the firm's management permits. 
C)  ​only for a reasonable purpose. 
D)  ​only in relation to Chet's capital contribution. 
A)  ​in their entirety. 
B)  ​only as the firm's management permits. 
C)  ​only for a reasonable purpose. 
D)  ​only in relation to Chet's capital contribution.

Question 12

Selections, a partnership, operates a gift shop. Selections has five partners. Tony has a one-third interest in the partnership. Each of the other partners has a one-sixth interest. With respect to management decisions​

Accepted Answer

A)  ​a majority of the partners must agree. 
B)  ​Tony rules. 
C)  ​the senior partner decides. 
D)  ​four of the partners must agree. 
A)  ​a majority of the partners must agree. 
B)  ​Tony rules. 
C)  ​the senior partner decides. 
D)  ​four of the partners must agree.

Question 13

Bette is one of three partners in Clean & Clear, a commercial janitorial service. With respect to her interest in the firm, when she dies, her heirs are most likely entitled to​

Accepted Answer

A)  ​nothing. 
B)  ​a payout of her capital contribution without more. 
C)  ​the buyout price paid by the firm for the interest. 
D)  ​one-third of the value of the interest. 
A)  ​nothing. 
B)  ​a payout of her capital contribution without more. 
C)  ​the buyout price paid by the firm for the interest. 
D)  ​one-third of the value of the interest.

Question 14

If a dispute arises and the applicable limited liability company statute does not cover the issue, a court will most likely dismiss the case.​

Accepted Answer

A) True 
 B)False

Question 15

Most states apply to a limited liability company (LLC) formed in another state the law of the state where the LLC currently does business.​

Accepted Answer

A) True 
 B)False

Question 16

Olivia is a partner in Pacific Traders. In the majority of states, with respect to any partnership obligations that Olivia does not participate in, know about, or ratify, she would be liable for​

Accepted Answer

A)  ​none of the obligations. 
B)  ​all of the obligations, jointly and severally. 
C)  ​all of the obligations, jointly but not severally. 
D)  ​only the contractual obligations. 
A)  ​none of the obligations. 
B)  ​all of the obligations, jointly and severally. 
C)  ​all of the obligations, jointly but not severally. 
D)  ​only the contractual obligations.

Question 17

Any business-except a sole proprietorship-must comply with business registration and licensing requirements.​

Accepted Answer

A) True 
 B)False

Question 18

Normally, a member who dissociates from a limited liability company (LLC) has the right to force the LLC to dissolve.​

Accepted Answer

A) True 
 B)False

Question 19

In most states, a limited liability company can have only a limited number of members.​

Accepted Answer

A) True 
 B)False

Question 20

In choosing a form of business organization for a new enterprise, important factors include tax considerations.​

Accepted Answer

A) True 
 B)False

Nina, the owner of Organic Farm, a sole proprietorship, wants to obtain additional capital to operate. This can be accomplished by

Carl starts up, and assumes the financial risk of, DataWorks, a new Web marketing enterprise. Carl and DataWorks must meet legal requirements relating to

Typically, the articles of organization of a limited liability company (LLC) include information on how the LLC will be managed.

Beth and Carol want to form a limited liability company to manage their business, DoReMi Music. Their state has adopted the Uniform Limited Liability Company Act, which has been adopted in

Members of a limited liability company can stipulate in their operating agreement how voting rights will be apportioned.

Limited liability company operating agreements can provide whether formal members' meetings will be held.

Any suit against the business or its employees can lead to unlimited personal liability for the owner of a sole proprietorship.

Craig, Donna, and Eve do business as Fast-Track Career Consultants. Eve's relationship to Fast-Track ends, but the firm continues to do business. This is

Luke and Maya form Northeast Air Express, a partnership. The essential elements of this partnership do not include

Chet is a partner in Diligent Accounting Service. Chet can inspect Diligent's books and records

Selections, a partnership, operates a gift shop. Selections has five partners. Tony has a one-third interest in the partnership. Each of the other partners has a one-sixth interest. With respect to management decisions

Bette is one of three partners in Clean & Clear, a commercial janitorial service. With respect to her interest in the firm, when she dies, her heirs are most likely entitled to

If a dispute arises and the applicable limited liability company statute does not cover the issue, a court will most likely dismiss the case.

Most states apply to a limited liability company (LLC) formed in another state the law of the state where the LLC currently does business.

Olivia is a partner in Pacific Traders. In the majority of states, with respect to any partnership obligations that Olivia does not participate in, know about, or ratify, she would be liable for

Any business-except a sole proprietorship-must comply with business registration and licensing requirements.

Normally, a member who dissociates from a limited liability company (LLC) has the right to force the LLC to dissolve.

In most states, a limited liability company can have only a limited number of members.

In choosing a form of business organization for a new enterprise, important factors include tax considerations.

Law and Legal Reasoning

Business and the Constitution

Courts and Alternative Dispute Resolution

Tort Law

Criminal Law and Cyber Crime

Business Ethics

Nature and Terminology

Agreement in Traditional and E-Contracts

Consideration, Capacity, and Legality

Defenses to Contract Enforceability

Third Party Rights and Discharge

Breach of Contract and Remedies

Intellectual Property Rights

Internet Law, Social Media, and Privacy

The Formation of Sales and Lease Contracts

Performance, Breach, and Warranties of Sales and Lease Contracts

Agency Relationships in Business

Corporations

Filters

Exam 18: Small Businesses and Limited Liability Companies

Nina, the owner of Organic Farm, a sole proprietorship, wants to obtain additional capital to operate. This can be accomplished by​

Carl starts up, and assumes the financial risk of, DataWorks, a new Web marketing enterprise. Carl and DataWorks must meet legal requirements relating to​

Typically, the articles of organization of a limited liability company (LLC) include information on how the LLC will be managed.​

Beth and Carol want to form a limited liability company to manage their business, DoReMi Music. Their state has adopted the Uniform Limited Liability Company Act, which has been adopted in​

Members of a limited liability company can stipulate in their operating agreement how voting rights will be apportioned.​

Limited liability company operating agreements can provide whether formal members' meetings will be held.​

Any suit against the business or its employees can lead to unlimited personal liability for the owner of a sole proprietorship.​

Craig, Donna, and Eve do business as Fast-Track Career Consultants. Eve's relationship to Fast-Track ends, but the firm continues to do business. This is​

Luke and Maya form Northeast Air Express, a partnership. The essential elements of this partnership do not include​

Chet is a partner in Diligent Accounting Service. Chet can inspect Diligent's books and records​

Selections, a partnership, operates a gift shop. Selections has five partners. Tony has a one-third interest in the partnership. Each of the other partners has a one-sixth interest. With respect to management decisions​

Bette is one of three partners in Clean & Clear, a commercial janitorial service. With respect to her interest in the firm, when she dies, her heirs are most likely entitled to​

If a dispute arises and the applicable limited liability company statute does not cover the issue, a court will most likely dismiss the case.​

Most states apply to a limited liability company (LLC) formed in another state the law of the state where the LLC currently does business.​

Olivia is a partner in Pacific Traders. In the majority of states, with respect to any partnership obligations that Olivia does not participate in, know about, or ratify, she would be liable for​

Any business-except a sole proprietorship-must comply with business registration and licensing requirements.​

Normally, a member who dissociates from a limited liability company (LLC) has the right to force the LLC to dissolve.​

In most states, a limited liability company can have only a limited number of members.​

In choosing a form of business organization for a new enterprise, important factors include tax considerations.​

Law and Legal Reasoning

Business and the Constitution

Courts and Alternative Dispute Resolution

Tort Law

Criminal Law and Cyber Crime

Business Ethics

Nature and Terminology

Agreement in Traditional and E-Contracts

Consideration, Capacity, and Legality

Defenses to Contract Enforceability

Third Party Rights and Discharge

Breach of Contract and Remedies

Intellectual Property Rights

Internet Law, Social Media, and Privacy

The Formation of Sales and Lease Contracts

Performance, Breach, and Warranties of Sales and Lease Contracts

Agency Relationships in Business

Corporations

Filters

Nina, the owner of Organic Farm, a sole proprietorship, wants to obtain additional capital to operate. This can be accomplished by

Carl starts up, and assumes the financial risk of, DataWorks, a new Web marketing enterprise. Carl and DataWorks must meet legal requirements relating to

Typically, the articles of organization of a limited liability company (LLC) include information on how the LLC will be managed.

Beth and Carol want to form a limited liability company to manage their business, DoReMi Music. Their state has adopted the Uniform Limited Liability Company Act, which has been adopted in

Members of a limited liability company can stipulate in their operating agreement how voting rights will be apportioned.

Limited liability company operating agreements can provide whether formal members' meetings will be held.

Any suit against the business or its employees can lead to unlimited personal liability for the owner of a sole proprietorship.

Craig, Donna, and Eve do business as Fast-Track Career Consultants. Eve's relationship to Fast-Track ends, but the firm continues to do business. This is

Luke and Maya form Northeast Air Express, a partnership. The essential elements of this partnership do not include

Chet is a partner in Diligent Accounting Service. Chet can inspect Diligent's books and records

Selections, a partnership, operates a gift shop. Selections has five partners. Tony has a one-third interest in the partnership. Each of the other partners has a one-sixth interest. With respect to management decisions

Bette is one of three partners in Clean & Clear, a commercial janitorial service. With respect to her interest in the firm, when she dies, her heirs are most likely entitled to

If a dispute arises and the applicable limited liability company statute does not cover the issue, a court will most likely dismiss the case.

Most states apply to a limited liability company (LLC) formed in another state the law of the state where the LLC currently does business.

Olivia is a partner in Pacific Traders. In the majority of states, with respect to any partnership obligations that Olivia does not participate in, know about, or ratify, she would be liable for

Any business-except a sole proprietorship-must comply with business registration and licensing requirements.

Normally, a member who dissociates from a limited liability company (LLC) has the right to force the LLC to dissolve.

In most states, a limited liability company can have only a limited number of members.

In choosing a form of business organization for a new enterprise, important factors include tax considerations.