Exam 4: Limited Liability Companies and Special Business Forms

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Generally, if a member dissociates form a limited liability company (LLC), the other members cannot continue to carry on the LLC's business.

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(True/False)

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Question 1

Correct Answer:

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False

Generally, a dissociated member of a limited liability company (LLC) has the right to buy his or her interest in the LLC from the other members.

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Question 2

Correct Answer:

Verified

False

Commerce & Trade Corporation and Distance Shipping & Transport, Inc., form a business trust. eCharge Auto Company and Fleet Electric Corporation form a joint stock company. Green AgriCorp and Harvest Farms, Inc., form an incorporated cooperative. What features do these combinations of business organization have in common?

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Question 3

Correct Answer:

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There are differences among these forms of business organizations, but all of them resemble corporations. For example, the joint stock company features ownership by shares of stock, management by directors and officers, and perpetual existence. Similar to a corporation, a business trust distributes profits to persons who are not personally responsible for the debts of the firm, and the management of the business is accomplished by trustees (a corporation is managed by its directors and officers). An incorporated cooperative, which is subject to state laws covering nonprofit corporations, distributes profits to its owners.

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

(True/False)

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Question 4

Lightning Corporation and Mind, Inc., two game creators, wish to combine their capabilities to make and market Nano, a special limited-edition game. The appropriate legal entity for this project is most likely

(Multiple Choice)

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Question 5

Limited liability companies (LLCs) are governed by federal LLC statutes.

(True/False)

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Question 6

Global Shipping Corporation and Harbor Warehouse Company transfer their property to Investment Managers, Inc., which manages the property and distributes the profits to the beneficiaries. This form of business organization is

(Multiple Choice)

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Question 7

Jess and Keri are members of Livewire LLC, a limited liability company. In most situations, with respect to Livewire's debts, Jess and Keri are shielded from

(Multiple Choice)

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Question 8

A joint venture is taxed like a corporation.

(True/False)

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Question 9

Michel is a citizen of France. With respect to a limited liability company in the United States, Michel can

(Multiple Choice)

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Question 10

Bee Hive Honey, LLC's members include Charlie and Donna. For purposes of suing and being sued, Bee Hive Honey is

(Multiple Choice)

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Question 11

Home Healthcare, LLC's owners are Inez and Jan. For purposes of entering into contracts, Home Healthcare is

(Multiple Choice)

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Question 12

Gail is the beneficiary of a business trust. As a beneficiary, she is required to

(Multiple Choice)

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Question 13

Foreign investors cannot participate in a limited liability company.

(True/False)

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Question 14

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

(True/False)

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Question 15

Lauren, Maria, and Nina form a syndicate to buy a professional soccer franchise. This syndicate could be set up as

(Multiple Choice)

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Question 16

Joint venturers do not have the authority as agents to enter into contracts for the business that will bind the joint venture.

(True/False)

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Question 17

Floyd and other consumers form Grocers Mart Cooperative. This form of business organization makes it possible for these consumers to

(Multiple Choice)

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Question 18

Unless otherwise agreed, joint venturers have an equal voice in controlling a venture-related project.

(True/False)

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Question 19

Valu Food Markets is an incorporated cooperative. Like other incorporated cooperatives, Valu Food distributes profits to its owners on the basis of

(Multiple Choice)

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Question 20

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Exam 4: Limited Liability Companies and Special Business Forms

Generally, if a member dissociates form a limited liability company (LLC), the other members cannot continue to carry on the LLC's business.

Generally, a dissociated member of a limited liability company (LLC) has the right to buy his or her interest in the LLC from the other members.

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

Lightning Corporation and Mind, Inc., two game creators, wish to combine their capabilities to make and market Nano, a special limited-edition game. The appropriate legal entity for this project is most likely

Limited liability companies (LLCs) are governed by federal LLC statutes.

Global Shipping Corporation and Harbor Warehouse Company transfer their property to Investment Managers, Inc., which manages the property and distributes the profits to the beneficiaries. This form of business organization is

Jess and Keri are members of Livewire LLC, a limited liability company. In most situations, with respect to Livewire's debts, Jess and Keri are shielded from

A joint venture is taxed like a corporation.

Michel is a citizen of France. With respect to a limited liability company in the United States, Michel can

Bee Hive Honey, LLC's members include Charlie and Donna. For purposes of suing and being sued, Bee Hive Honey is

Home Healthcare, LLC's owners are Inez and Jan. For purposes of entering into contracts, Home Healthcare is

Gail is the beneficiary of a business trust. As a beneficiary, she is required to

Foreign investors cannot participate in a limited liability company.

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

Lauren, Maria, and Nina form a syndicate to buy a professional soccer franchise. This syndicate could be set up as

Joint venturers do not have the authority as agents to enter into contracts for the business that will bind the joint venture.

Floyd and other consumers form Grocers Mart Cooperative. This form of business organization makes it possible for these consumers to

Unless otherwise agreed, joint venturers have an equal voice in controlling a venture-related project.

Valu Food Markets is an incorporated cooperative. Like other incorporated cooperatives, Valu Food distributes profits to its owners on the basis of

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