BLAW chpt 12
during the course of a partnership's winding up process the partners owe each other
a duty to disclose all finances of the partnership
partners in a partnership owe each other
a fiduciary duty
a limited partnership is usually dissolved by the bankruptcy of
a general partner but not a limited partner
in most circumstances, a partnership is now treated as
a legal entity
a limited partnership is different from a general partnership because
a limited partnership may only have one general partner
which of the following statements are true
a limited partnership must have at least one general partner
a sole proprietorship comes into existence when
a person begins to do business for herself
which of the following apply to a sole proprietorship
a person is in business for himself
many states now allow groups of doctors in practice together to form a particular legal entity allowed by statute called
a professional corporation
to hold a shareholder meeting, which criteria must be met
a quorum of shareholders must be represented and advance notice of the meeting must be given
a partnership can begin with
a written agreement or an oral agreement or an implied agreement that can be inferred from the conduct of the parties doing business
electing a board of directors, enacting the corporations bylaws and issuing the corporations stock are all things that occur
after the state has issued the corporations certificate of incorporation
a partnership can begin with either
an oral or implied agreement
general partners in a limited partnership
are personally liable to the partnership's creditors
in most states a limited partnership does not have to file what information with the appropriate state official
bankruptcy history of each partner
involuntary dissolution of a corporation is usually caused by
bankruptcy or fraud in the establishment of the corporation
the duty of partners to a partnership is
based on extraordinary trust and loyalty to the partnership
unless the limited partnership agreement hold otherwise when a limited partnership is dissolved the limited partners receive their share of the profits and their capital contributions
before general partners receive anything
the governing committee of a corporation is the
board of directors
limited partners are similar to corporate shareholders in that
both are liable to the extent of their investment
after reviewing a corporations application, the state issues a
certificate of incorporation
dissolution of a partnership takes place, unless otherwise provided for by contract, in the following instances except
change in financial condition of a partner bankruptcy, withdrawal or death of a partner
a ____ is an artificial person or legal entity, created under state law
corporation
coca cola, microsoft and general motors are all examples of
corporations
a reason the corporate status is often chosen is
corporations have the status of a legal person
which of the following is not true about corporate directors
directors must always act to preserve the corporation
a board of directors fiduciary duty of loyalty requires that
directors place the interests of the corporation before their own interests
the process of settling the accounts and liquidating the assets of a corporation is called
dissolution
a complete termination comes about only after the partnership has been ______ and its affairs have been wound up
dissolved
directors are under a _____ to conduct themselves on behalf of the corporation as a reasonably prudent person in the conduct of personal business affairs
duty of care
a corporation is recognized under both federal and state law as a person and
enjoys some of the same rights and privileges accorded to US citizens
a ______ is any name other than the name of the individual who owns the business
fictitious name
______ requires that directors of a corporation place the interest of the corporation before their own interests
fiduciary duty of loyalty
requires that each partner act in good faith for the benefits of the partnership
fiduciary relationship
under traditional common law rules, a partnership
generally was not treated as a single legal entity
the shareholders of a corporation generally have the right to
give a third party the right to vote their shares by proxy
a shareholders relation to creditors of the corporation is generally that the shareholder
has no relation to the creditors
the dissolution of a partnership may occur
if a partner is found to be bankrupt or if a partner dies or if the business of the partnership is made unlawfully
professional corporations are now allowed
in all states
the modern corporation was developed
in the US during the 18th century
in a sole proprietorship, profits are taxed to the
individual owner of the proprietorship
a termination of a corporation
is conducted in two phases: dissolution and winding up and prevents the corporation from taking on any new business and may be brought about either voluntarily or involuntarily
the owner of a sole proprietorship
is legally the same as the business and is taxed the same as the business and may hire any number of employees
A certification of incorporation from the government
is necessary for a corporation to be recognized legally
a limited liability company
is taxed like a partnership and has liability of a corporation
which of the following is not true about a partnership
it is always an independent legal entity
which of the following is not true about the termination of a limited partnership
limited and general partners share assets equally at the same time after the creditors are paid
a business organization in which some of the partners are not liable for partnership debts is called a
limited liability partnership
in a limited partnership the ____ are investors who may not participate in managing the business
limited partners
a business organization made up of 2 or more persons who have entered into an agreement to carry on a business venture for a profit, and not all persons have the right to participate in management decisions is a
limited partnership
shareholders of a corporation have
limited rights to see the corporations books and records vote on matters that may effect a change in the corporations structure
a corporations board of directors hires _____ to run the business
managers
dissolution of a corporation
may be voluntary or involuntary
limited partners are investors who
may not participate in management of the business
in a sole proprietorship, the capital usually
must come from the owner's own resources or be borrowed
the articles of incorporation usually provide all of the following but
names of all shareholders name of CEO address of the corporation and the purpose of the business and classes of stock to be issued are included
unless otherwise stated by contract, the law of partnership presumes which of the following not to be true
only managing partners are fully responsible for debts of the partnership
there are _____ businesses in the US
over 30 million
a disadvantage of the sole proprietorship is often the
owner is personally liable for all the business debts
a corporation separates
ownership from control
in general limited partners lose their limited liability status by
participating in managerial decisions in the partnership
association of 2 or more persons to carry on a business as co-owners for profit
partnership
in the final dispersal of the assets of the limited partnership, creditors rights
precede partners rights
legally, the board of directors is the _____ of a corporation
principle
which of the following statements about a corporation is true? corporations are not entitles to constitutionally protected
privileges against self incrimination
the most common form of business organization is
proprietorship
the oldest and simplest form of business organization is the
proprietorship
the business judgement rule
protects directors and managers of a corporation who have mad honest mistakes in judgement
_____ are those with stock traded on a stock exchange and, therefore, are likely to have many shareholders
publicly held corporations
directors of a corporation may be
removed for cause and be liable for a breach of duty
at a shareholder meeting, important corporate business is presented to the shareholders in the form of _____, which shareholders vote to approve or disapprove
resolutions
the ____ provides "default rules" that determine the operation of partnerships when the partnership agreement is silent or where there is no formal agreement among the partners
revised uniform partnership act
whom of the following must follow a corporations bylaws in conducting corporate activities
share holders directors officer of the corporation
the board of directors of a corporation are elected by
shareholders
the owners of corporation are called
shareholders
a corporation consists of
shareholders, board of directors and officers or managers
the majority of businesses in the us are
sole propietorships
a person doing business for himself or herself is a
sole proprietor
a person doing business for herself is a _____; the business a _______
sole proprietor, proprietorship
a corporation consists of legally distinct groups not including
stakeholders
today a corporation must be created according to
state law
under traditional common law rules, if you wanted to sue a partnership you had to
sue each partner individually
a change in the relationship that shows an unwillingness or an inability to continue with business may bring about ____ of the partnership
termination
a close corporation is one
that has a small number of stockholders
a written partnership agreement typically specifies all of the following except
that the partnership will be established under federal or state law
in a sole proprietorship, the owner is
the business
which of the following are not required to be in certificate of limited partnership
the business positions to be held by each partner
the rules that regulate and govern the internal operations of a corporation are known as
the bylaws
to create a corporation
the corporations articles of incorporations are filed with the appropriate officer of the state
corporations have existed for centuries, but the modern "liberal" general incorporation statutes were first passed in
the late 1800's
a disadvantage of the sole proprietorship form is often
the limited alternatives for raising financial capital
under the uniform limited partnership act, a written agreement must include
the name of the business and they type or character of the business and the contributions of each partner
which of the following is a right of a limited partner in a limited partnership
the right to see the partnership books the right to participate in the dissolution of the business
in general, if a partnership agreement does not specify what happens in case of the death or departure of a partner one looks to
uniform partnership act
a ______ of a corporation involves approval of the shareholders and the board of directors
voluntary
there are two types of dissolution of a corporation
voluntary and involuntary
the dissolution of a partnership occurs
when an event takes place that precludes the partners from continuing in business
the articles of organization filed for a LLC must include
whether it will be managed by its members or by a manger the address of the company or its registered agent whether any members are liable for company debts
if a shareholder supplies needed material to the business then he
will become a creditor of the corporation and will enjoy the same rights of recovery against the corporation as any other creditor
the _____ of partnership affairs involves completing any unfinished business and then collecting and distributing the partnerships assets
winding up