Question 1

Big Valu Grocery Stores is an unincorporated cooperative. Big Valu and other unincorporated cooperatives are generally treated like

Accepted Answer

A)  business trusts. 
B)  corporations. 
C)  joint stock companies. 
D)  partnerships.

Question 2

Consumers in Delta City form a business organization to provide, without profit, an economic service to its members. This is

Accepted Answer

A)  a business trust. 
B)  a cooperative. 
C)  a corporation. 
D)  a joint stock company.

Question 3

Elmo is the owner and manager of a business trust. Under the terms of a business trust, Elmo is required to

Accepted Answer

A)  distribute the profits and manage the property. 
B)  distribute the profits only. 
C)  manage the property only. 
D)  neither distribute the profits nor manage the property.

Question 4

The participants in a joint venture have more implied and apparent authority than the partners in a partnership.

Accepted Answer

A) True 
 B)False

Question 5

A limited liability company is operated in compliance with state law.

Accepted Answer

A) True 
 B)False

Question 6

Kris is a member of Laboratory Services, LLC, a limited liability company. Kris can participate in the firm's management

Accepted Answer

A)  only to the extent that she assumes liability for the firm's debts. 
B)  only to the extent of her investment in the firm. 
C)  to any extent. 
D)  to no extent.

Question 7

A foreign limited liability company (LLC) is an LLC owned by an entity outside the United States.

Accepted Answer

A) True 
 B)False

Question 8

As the beneficiary of a business trust, Kevin's liability for trust debts and obligations is

Accepted Answer

A)  limited to his capital investment in the trust. 
B)  limited to his personal assets. 
C)  nothing. 
D)  unlimited.

Question 9

Delta Music Company and Eagle Tech Corporation form a joint stock company. A joint stock company can be formed for, at the most,

Accepted Answer

A)  an implied duration of not more than six months. 
B)  a perpetual existence. 
C)  a single activity or transaction. 
D)  a stated duration of not more than one year.

Question 10

The owners of a joint stock company are personally liable for its obligations.

Accepted Answer

A) True 
 B)False

Question 11

Most states do not permit one-member limited liability companies.

Accepted Answer

A) True 
 B)False

Question 12

Jade, Kelly, and Lila organize a nonprofit business-JKL Markets, Inc.-to buy groceries from wholesalers and sell them to consumers who buy a membership in JKL. Because the firm is a nonprofit entity, it is able to sell the groceries for less than a commercial grocer could. What form of business organization is JKL Markets? Is it significant that JKL is incorporated?

Accepted Answer

The answer of Jade, Kelly, and Lila organize a nonprofit...

Question 13

Serious Gamers, LLC, is a limited liability company. Among the mem?bers, a dispute arises that their operating agreement does not cover. No statute applies. The dispute is governed by the principles of

Accepted Answer

A)  corporate law. 
B)  partnership law. 
C)  sole proprietorship law. 
D)  syndicate law.

Question 14

A syndicate may be organized as a corporation but not as a partnership.

Accepted Answer

A) True 
 B)False

Question 15

A limited liability company offers the limited liability of a corporation.

Accepted Answer

A) True 
 B)False

Question 16

Omega Corporation and Precise Code, Inc., two software firms, wish to combine their research and development capabilities to make a special, limited edition computer game. The most appropriate legal en?tity for this project might be

Accepted Answer

A)  a business trust. 
B)  a joint stock company. 
C)  a joint venture. 
D)  a syndicate.

Question 17

A limited liability company must be formed in compliance with federal law.

Accepted Answer

A) True 
 B)False

Question 18

QuikBooks LLC is a limited liability company. Like any other LLC, unless QuikBooks chooses otherwise, the firm will be taxed as

Accepted Answer

A)  a corporation. 
B)  a joint venture. 
C)  a partnership. 
D)  a sole proprietorship.

Question 19

National Capital Corporation and International Investments, Inc., form a joint stock company. The ownership of a joint stock company is repre?sented by

Accepted Answer

A)  partnership certificates. 
B)  shares of stock. 
C)  title documents. 
D)  trust certificates.

Question 20

In some states, business trusts pay corporate taxes.

Accepted Answer

A) True 
 B)False

Exam 37: Limited Liability Companies Special Business Forms

Big Valu Grocery Stores is an unincorporated cooperative. Big Valu and other unincorporated cooperatives are generally treated like

Consumers in Delta City form a business organization to provide, without profit, an economic service to its members. This is

Elmo is the owner and manager of a business trust. Under the terms of a business trust, Elmo is required to

The participants in a joint venture have more implied and apparent authority than the partners in a partnership.

A limited liability company is operated in compliance with state law.

Kris is a member of Laboratory Services, LLC, a limited liability company. Kris can participate in the firm's management

A foreign limited liability company (LLC) is an LLC owned by an entity outside the United States.

As the beneficiary of a business trust, Kevin's liability for trust debts and obligations is

Delta Music Company and Eagle Tech Corporation form a joint stock company. A joint stock company can be formed for, at the most,

The owners of a joint stock company are personally liable for its obligations.

Most states do not permit one-member limited liability companies.

Serious Gamers, LLC, is a limited liability company. Among the mem?bers, a dispute arises that their operating agreement does not cover. No statute applies. The dispute is governed by the principles of

A syndicate may be organized as a corporation but not as a partnership.

A limited liability company offers the limited liability of a corporation.

Omega Corporation and Precise Code, Inc., two software firms, wish to combine their research and development capabilities to make a special, limited edition computer game. The most appropriate legal en?tity for this project might be

A limited liability company must be formed in compliance with federal law.

QuikBooks LLC is a limited liability company. Like any other LLC, unless QuikBooks chooses otherwise, the firm will be taxed as

National Capital Corporation and International Investments, Inc., form a joint stock company. The ownership of a joint stock company is repre?sented by

In some states, business trusts pay corporate taxes.