Question 1

In which of the following business entities would the creditors be able to recover moneys owed to them by the business from the proprietors of the business?

Accepted Answer

A) The trading trust where a company is used to conduct the business. 
B) The limited liability company. 
C) The sole trader. 
D) None of the above. 
A) The trading trust where a company is used to conduct the business. 
B) The limited liability company. 
C) The sole trader. 
D) None of the above.

Question 2

Which are the three certainties that are necessary for the creation of an express trust?

Accepted Answer

A) Intention to create a trust,agreement and consideration. 
B) Intention to create a trust,plus certainty of the identity of the property and beneficiaries. 
C) Intention to create a trust,consent of the beneficiaries and agreement of the trustee. 
D) Consideration,knowledge on the part of the beneficiaries and certainty of duration. 
A) Intention to create a trust,agreement and consideration. 
B) Intention to create a trust,plus certainty of the identity of the property and beneficiaries. 
C) Intention to create a trust,consent of the beneficiaries and agreement of the trustee. 
D) Consideration,knowledge on the part of the beneficiaries and certainty of duration.

Question 3

Franchises are regulated by the Competition and Consumer Act 2010 (Cth).

Accepted Answer

A) True 
 B)False

Question 4

A franchise is a specialised business entity.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following statements about a sole trader is NOT true?

Accepted Answer

A) Anyone capable of entering into a contract can operate a business as a sole trader. 
B) A sole trader may have difficulty in raising business capital. 
C) Sole traders have unlimited liability for the debts of the business. 
D) The business of a sole trader can sue and be sued in its own name. 
A) Anyone capable of entering into a contract can operate a business as a sole trader. 
B) A sole trader may have difficulty in raising business capital. 
C) Sole traders have unlimited liability for the debts of the business. 
D) The business of a sole trader can sue and be sued in its own name.

Question 6

Which of the following is NOT one of the duties of a trustee?

Accepted Answer

A) Preserve the trust property. 
B) Indemnify the beneficiaries for any losses. 
C) Act in accordance with the trust. 
D) Avoid conflict of interest and personal benefit. 
A) Preserve the trust property. 
B) Indemnify the beneficiaries for any losses. 
C) Act in accordance with the trust. 
D) Avoid conflict of interest and personal benefit.

Question 7

Which of the following describes a trust in which the trustee has the power to choose beneficiaries along with the amount of proceeds they are to be paid?

Accepted Answer

A) Fixed trust. 
B) Trading trust. 
C) Discretionary trust. 
D) Constructive trust. 
A) Fixed trust. 
B) Trading trust. 
C) Discretionary trust. 
D) Constructive trust.

Question 8

Under an express trust,the beneficiary is able to exercise discretion as to who should benefit and how much they should get.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements about a sole trader is NOT true?

Accepted Answer

A) A sole trader may have difficulty in raising business capital. 
B) The sole trader must generally consult with customers,creditors and employees in deciding what the business will and will not do. 
C) Anyone with contractual capacity can be a sole trader. 
D) The liability of a sole trader is unlimited and personal. 
A) A sole trader may have difficulty in raising business capital. 
B) The sole trader must generally consult with customers,creditors and employees in deciding what the business will and will not do. 
C) Anyone with contractual capacity can be a sole trader. 
D) The liability of a sole trader is unlimited and personal.

Question 10

Which of the following is an advantage of a franchise for the franchisee?

Accepted Answer

A) Rapid expansion. 
B) Virtually instant reputation and goodwill. 
C) Total control over the business. 
D) Fewer staff problems. 
A) Rapid expansion. 
B) Virtually instant reputation and goodwill. 
C) Total control over the business. 
D) Fewer staff problems.

Question 11

An identified beneficiary with an equal share is said to belong to a(n):

Accepted Answer

A) implied trust. 
B) specific trust. 
C) fixed trust. 
D) resulting trust. 
A) implied trust. 
B) specific trust. 
C) fixed trust. 
D) resulting trust.

Question 12

Which of the following is an accurate description of an implied trust?

Accepted Answer

A) The trustee has the power to choose the beneficiaries and the amounts to be paid to them. 
B) The parties clearly intended to create a trust,but did not express that intention. 
C) Each beneficiary is identified in the trust deed and has an equal share in the trust. 
D) A person has become the legal owner of property as the result of a breach of fiduciary duty. 
A) The trustee has the power to choose the beneficiaries and the amounts to be paid to them. 
B) The parties clearly intended to create a trust,but did not express that intention. 
C) Each beneficiary is identified in the trust deed and has an equal share in the trust. 
D) A person has become the legal owner of property as the result of a breach of fiduciary duty.

Question 13

Which of the following is an advantage of a franchise for the franchisor?

Accepted Answer

A) Virtually instant reputation and goodwill. 
B) Benefiting from the marketing efforts of the other party. 
C) Benefiting from the financial expertise of the other party. 
D) Rapid expansion. 
A) Virtually instant reputation and goodwill. 
B) Benefiting from the marketing efforts of the other party. 
C) Benefiting from the financial expertise of the other party. 
D) Rapid expansion.

Question 14

The purpose of business name registration is to prevent consumers being confused.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following statements about a trustee is NOT true?

Accepted Answer

A) The liability of a trustee is unlimited unless a company is appointed to operate the business of the trust. 
B) Any person capable of holding the title to property is capable of being a trustee. 
C) The trustee is responsible for all losses on trust investments. 
D) The trustee is entitled to full indemnity out of the trust property for their expenses and costs. 
A) The liability of a trustee is unlimited unless a company is appointed to operate the business of the trust. 
B) Any person capable of holding the title to property is capable of being a trustee. 
C) The trustee is responsible for all losses on trust investments. 
D) The trustee is entitled to full indemnity out of the trust property for their expenses and costs.

Question 16

Define a sole trader and discuss its advantages and disadvantages.

Accepted Answer

A sole trader owns and controls his or h

Question 17

In choosing a business entity which of the following is NOT a factor in making the decision?

Accepted Answer

A) Tax implications. 
B) Limiting potential liability. 
C) Government approval. 
D) Opportunity to raise capital. 
A) Tax implications. 
B) Limiting potential liability. 
C) Government approval. 
D) Opportunity to raise capital.

Question 18

Which of the following is NOT an advantage of a trading trust?

Accepted Answer

A) Protection of privacy. 
B) Opportunity for wealth transfer between generations. 
C) Protection of assets against creditors. 
D) Personal control over trust activities. 
A) Protection of privacy. 
B) Opportunity for wealth transfer between generations. 
C) Protection of assets against creditors. 
D) Personal control over trust activities.

Question 19

Which of the following statements about a trading trust is NOT true?

Accepted Answer

A) Business information can remain private. 
B) Assets can be protected from creditors. 
C) Simple and cheap to establish. 
D) Control of business assets can be maintained. 
A) Business information can remain private. 
B) Assets can be protected from creditors. 
C) Simple and cheap to establish. 
D) Control of business assets can be maintained.

Question 20

Trading under an unregistered business name is an offence under the Business Names Registration Act 2011 (Cth).

Accepted Answer

A) True 
 B)False

Exam 21: Choosing a Business Entity

In which of the following business entities would the creditors be able to recover moneys owed to them by the business from the proprietors of the business?

Which are the three certainties that are necessary for the creation of an express trust?

Franchises are regulated by the Competition and Consumer Act 2010 (Cth).

A franchise is a specialised business entity.

Which of the following statements about a sole trader is NOT true?

Which of the following is NOT one of the duties of a trustee?

Which of the following describes a trust in which the trustee has the power to choose beneficiaries along with the amount of proceeds they are to be paid?

Under an express trust,the beneficiary is able to exercise discretion as to who should benefit and how much they should get.

Which of the following statements about a sole trader is NOT true?

Which of the following is an advantage of a franchise for the franchisee?

An identified beneficiary with an equal share is said to belong to a(n):

Which of the following is an accurate description of an implied trust?

Which of the following is an advantage of a franchise for the franchisor?

The purpose of business name registration is to prevent consumers being confused.

Which of the following statements about a trustee is NOT true?

Define a sole trader and discuss its advantages and disadvantages.

In choosing a business entity which of the following is NOT a factor in making the decision?

Which of the following is NOT an advantage of a trading trust?

Which of the following statements about a trading trust is NOT true?

Trading under an unregistered business name is an offence under the Business Names Registration Act 2011 (Cth).

Legal Foundations

Legal Systems

How Law Is Made: Precedentstatute Law

Civil Liability: the Law of Torts and Negligence

Applications of Negligence to Business

Introduction to Contracts

Agreement Between the Parties

Intention to Create Legal Relations

Consideration

Capacity of the Parties

Genuine Consent

Is the Contract Legal

Terms of the Contract

Rights and Liabilities of the Parties,discharge and Remedies

Remedies in Contract

Statutory Consumer Guarantees and the Australian Consumer Law

General and Specific Consumer Protections Under the Acl

Introduction to Companies and Incorporated Associations

Agency

Partnerships

Other Business-Related Torts

Insurance

Sale of Goodsbusiness to Business

Property and Mortgages

Intellectual Property

Ethics and Business Practice

Criminal Law in a Business Context

Competition Law

Insolvency and Debt Recovery

The Work Environment and the Employment Relationship

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