Question 1

The statute of frauds expressly applies to a contract for the formation of a partnership.

Accepted Answer

A) True 
 B)False

Question 2

A partner who has no right to participate in control of the business and who has limited liability is called a:

Accepted Answer

A) limited partner. 
B) nominal partner. 
C) secret partner. 
D) general partner. 
A) limited partner. 
B) nominal partner. 
C) secret partner. 
D) general partner.

Question 3

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 4

Former partners, as well as current partners, have some rights to access partnership books and records.

Accepted Answer

A) True 
 B)False

Question 5

A person who receives a share of profits of a business is presumed to be a partner in the business.

Accepted Answer

A) True 
 B)False

Question 6

Mount Pleasant Tires does not have sufficient funds to pay damages for a tort that arose out of the operation of the business.Jess, a business owner, is personally liable if:

Accepted Answer

A) he is a sole proprietor of the business. 
B) the business is a corporation and he is a shareholder. 
C) he committed the tort. 
D) he is a general partner of the business. 
E) All of the above except (b). 
A) he is a sole proprietor of the business. 
B) the business is a corporation and he is a shareholder. 
C) he committed the tort. 
D) he is a general partner of the business. 
E) All of the above except (b).

Question 7

Assume that you and your best friend have decided to form a partnership after graduation.You have both studied business law, so you both know the importance of having a written partnership agreement.Summarize the clauses that you would include in your partnership agreement.

Accepted Answer

The basic clauses of a partnership agree

Question 8

States have authorized the formation of limited liability companies.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following forms of business association may elect that only the partners/members are taxed?

Accepted Answer

A) General partnership. 
B) Limited partnership. 
C) Limited liability company. 
D) All of the above. 
A) General partnership. 
B) Limited partnership. 
C) Limited liability company. 
D) All of the above.

Question 10

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.

Exam 31: Formation and Internal Relations of General Partnerships

The statute of frauds expressly applies to a contract for the formation of a partnership.

A partner who has no right to participate in control of the business and who has limited liability is called a:

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

Former partners, as well as current partners, have some rights to access partnership books and records.

A person who receives a share of profits of a business is presumed to be a partner in the business.

Mount Pleasant Tires does not have sufficient funds to pay damages for a tort that arose out of the operation of the business.Jess, a business owner, is personally liable if:

Assume that you and your best friend have decided to form a partnership after graduation.You have both studied business law, so you both know the importance of having a written partnership agreement.Summarize the clauses that you would include in your partnership agreement.

States have authorized the formation of limited liability companies.

Which of the following forms of business association may elect that only the partners/members are taxed?

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

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

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

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