LAW FOR ACCOUNTANTS
Betty, the manager of The Great Retail Store, purchases a variety of merchandise on credit. When Betty quits, what notice must The Great Retail Store provide to its creditors?
The Great Retail Store should send an actual notice to parties Betty has done credit business with and place an advertised notice in a newspaper of general circulation to the rest of the public.
According to Blank______, an electronic Blank______, sometimes called a bot, is a computer program that acts without human intervention to begin an activity.
UCITA; agent
______, which has been adopted in many states, allows Blank______ to be created by electronic agents.
UETA; enforceable contracts
The Blank______ set forth by the National Conference of Commissioners on Uniform State Laws was developed in 1914.
UPA
Under the Blank______, it was not clear whether a Blank______ was an entity or a(n) aggregate. Multiple choice question.
UPA; partnership
In which of the following situations can an agent legally appoint a subagent?
When the appointment is implied from the nature of the employment
Gordon employs Josh as an agent to sell Gordon's house. When does this agency end if the agreement is silent?
When the house is sold
Greta, an agent, receives money from clients of Wayne, her principal, on the fifteenth of each month. In the absence of an agreement, how frequently must Greta account to Wayne for the money she receives?
Within a reasonable period of time after the money is received
Corazon employs Josefina, a C.P.A., to represent her in tax liability negotiations with the IRS. Josefina is busy with other clients and delegates the negotiation to Lillian, a non-C.P.A. member of her office. Has Corazon impliedly agreed to this delegation?
Yes, Corazon is relying on Josefina's skill and integrity.
Carlos instructs his sales agent, Edgar, not to sell on credit to Andrew because Carlos has experienced problems collecting from Andrew for prior purchases. Edgar sells on credit to Andrew, who pays properly. Has Edgar violated any obligation to Carlos?
Yes, Edgar has violated the duty to obey all instructions of the principal.
A(n) ____________ is an exception to the rule that says that either the principal or the agent may terminate an agency relationship at any time
agency coupled with an interest
A(n) Blank______ is a special type of agency in which an agent is given Blank______.
agency coupled with an interest; an interest in the subject matter of the agency
When a(n) Blank______ enters into a(n) Blank______ based on the terms and conditions set forth by the Blank______, the principal is bound to the terms of that contract.
agent; contract; principal
A(n) Blank______ is appointed by a(n) Blank______ to negotiate and enter into a(n) Blank______ on behalf of the principal.
agent; principal; contract
Often, a(n) Blank______ is hired by the Blank______ to do business with a(n) Blank______.
agent; principal; third party
According to the Blank______ theory, a partnership is treated as a collection of partners who do business together.
aggregate
In terms of partnership property, the RUPA states that partners: Blank______.
are not co-owners of partnership property.
The RUPA essentially defines a partnership as a(n) Blank______ of two or more persons as Blank______ for profit.
association; co-owners
The RUPA essentially defines a partnership as a(n) Blank______ of two or more persons as Blank______ for profit. Multiple choice question.
association; co-owners
The remedies of an agent against a principal are based on the principal's
breach of contract.
Joint and several liability means that the partners: Blank______.
can be sued individually or together.
Generally, Blank______ contributions are considered Blank______.
capital; partnership property
When giving notice of termination of an agency, the safest way is by Blank______ mail, because the U.S. Post Office provides a receipt of the notice.
certified
Under the UPA, each partner was a Blank______, owning a Blank______ in each piece of partnership property. Multiple choice question.
co-owner; tenancy in partnership
An agency relationship is a(n) Blank______ one, which means the agent must be free to act, or not act, on behalf of the principal.
consensual
An agent's obligations must be in compliance with the agency Blank______ and the Blank______ relationship
contract; fiduciary
One of the remedies an agent has is to recover Blank______ against a principal for a breach of contract.
damages
Suppose James is an agent for CarMax and signs a contract on behalf of CarMax with CarTransport Co. to transport cars. CarMax would be a(n)
disclosed principal.
Under the RUPA, if Tom, who is a general partner in Gowan & Associates, leaves the firm, a(n) Blank______ takes place, but the partnership does not necessarily end.
dissociation
Unless a(n) Blank______ is a(n) Blank______, she has no power to negotiate and sign a(n) Blank______ for her employer.
employee; agent; contract
The main difference between dissociation and dissolution is that, in a dissolution, the firm Blank______.
ends.
Based on the Blank______ theory, a partnership exists as an individual person with its own separate identity.
entity
If a creditor chose to file a lawsuit against MIDTOWN PARTNERS, it would most likely be suing the partnership under the Multiple choice question.
entity theory.
RUPA treats partnership property as belonging to a(n)
entity.
Signing a contract with a real estate agent to list your home for sale would be an example of
express authority.
Sadie, an elderly widow who is housebound, signs a document giving Harvey her power of attorney. In this case, Harvey has Blank______ and Sadie is a Blank______ principal.
express authority; disclosed
An agency relationship is a(n) Blank______ one, because the agent and principal must trust each other.
fiduciary
Agents are appointed by principals because of their presumed Blank______ to perform a particular task.
fitness
Some states require a Blank______ if a Blank______ uses a fictitious name.
formal filing; sole proprietorship
Some states require a Blank______ if a Blank______ uses a fictitious name. Multiple choice question.
formal filing; sole proprietorship
When significant events make an agency impractical, the agency is terminated by
operation of law.
Brad hires Angelina to be his agent at a campaign event, which she completes. When Brad pays Angelina, the best answer is that the agency was
terminated by acts of the parties.
Perhaps the greatest advantage of a sole proprietorship is that:
the owner has complete control over the business.
An agency that is terminated by acts of the parties includes all of the following except
the principal's bankruptcy.
Under the RUPA, prima facie evidence of a partnership is
the sharing of profits.
Property that was obtained by a partner in her role as a partner is
treated as partnership property under RUPA.
An agent's duty of loyalty means she likely cannot act for:
two principals in the same transaction.
In most cases, forming a sole proprietorship can be as easy as creating a business card, a Facebook page, and
"opening your doors" for business.
Which of the following factors according to Orlov caused the economic collapse in the Soviet Union:
A decline in energy A serious trade deficit
Jamie authorizes Amy to sell his house, but does not clarify about the compensation payable to Amy. What amount should be paid to Amy when she sells Jamie's house?
A fair value for the services performed
Charlena, a shelf-stocker, offers Megan the post of Vice-President of Procurement to express appreciation for Megan's hard work in stocking the shelves at Charlena's store, Thrift City. Megan creates business cards with her new title on them and uses one to purchase a new truck in Thrift City's name from Highway Auto. Which of these types of authority, if any, has Charlena given Megan?
Apparent authority
Repair Garage Company rents tools and stalls to independent auto mechanics to repair cars. Repair Garage allows Joe to print business cards reading "Repair Garage Company—Joe, Certified Mechanic." A customer is unhappy with the repairs Joe made to her car and sues Repair Garage. What legal theory, if any, would allow Repair to be sued by the customer?
Apparent authority
Desmond, obeying the instructions of his employer, Bigger Company, sells Harry a computer system that is not capable of being expanded. Harry is now suing Desmond asserting fraud, but Desmond defends that Harry did not request an expandable system. What responsibility if any, does Bigger Company owe Desmond?
As Bigger's agent following instructions, Desmond is entitled to indemnification.
Sandra is hired by BigBox as a buying agent for new products. Without BigBox's knowledge, Sandra hires Rhonda as her sub-agent to "fill in" for her while she is on vacation. While Sandra is on vacation, Rhonda signs 3 new contracts on behalf of BigBox. What is the result?
BigBox is not bound by the contracts because Rhonda is a subagent.
True or false: The RUPA requires a partnership agreement to be in writing. True false question.
False
True or false: Under the RUPA, a partnership can exist if it is formed to be a non-profit.
False
True or false: Under the RUPA, a partnership can exist if it is formed to be a non-profit. True false question.
False
Thomas is named "office manager" by Bigger Co., but his precise duties are not described. What type of authority would authorize Thomas to purchase office supplies?
Implied authorityCorrect
Geoffrey is an agent of Smith's Meat Products Limited. While delivering products, the company's van breaks down. What legal theory, if any, would allow Geoffrey to contract a garage for the repair of the principal's van?
Incidental authority
Iris represents Drew, an eccentric billionaire who lives alone on a Pacific Island. Although Drew passes away on May 1st, this fact is not revealed until June 1st. On May 15th, Iris enters into a contract with Peggy on behalf of Drew. What is the legal liability, if any, of Iris to Peggy?
Iris is liable for a breach of implied warranty of authority.
Smith, an agent, buys and sells used computer equipment on behalf of New Life Technologies, Inc. In the absence of an agreement, which of the following tasks may Smith delegate to Elizabeth?
Keeping a record of transactions Smith undertakes on behalf of New Life.
Morgan, an agent, was instructed to sell Drew's property at a specified "firm" price of $450,000. A month later, the value of the property decreased substantially to $75,000 because of zoning changes. What is the status of the agency relationship?
Most likely, the agency is terminated because of impossibility.
The Blank______ establishes that a partner has an interest in the partnership as a firm.
RUPA
The Blank______ solves one of the most troubling problems of the old partnership structure: Blank______ liability.
RUPA, joint and several
The Blank______ solves one of the most troubling problems of the old partnership structure: Blank______ liability. Multiple choice question.
RUPA, joint and several
Under the Blank______, personal liability of partners was altered to Blank______ liability.
RUPA, joint and several
Under the Blank______, a partner has a nontransferable interest in Blank______.
RUPA, management rights.
Henry owns a movie production house which is represented by a BigLaw Firm. He also owns a shipping agency which is represented by Chase Bank. The agency relationships will be terminated by the bankruptcy of which of the parties?
The bankruptcy of Henry will terminate the agency relationship.
Bill employs Charles as a real estate agent to sell his house. The house is destroyed by fire. What is the status of the agency relationship?
The relationship is automatically terminated.
An agent has a duty to obey all Blank______ and be Blank______ to the principal.
instructions; loyal
Termination by operation of Blank______ occurs in instances of death, insanity, bankruptcy, or impossibility of performance.
law
The Uniform Electronic Transactions Act (UETA):
legitimizes the use of electronic agents.
A principal is Blank______ to any third party for any contract signed by a general or special agent Blank______.
liable; if the act was approved by the principal
An agent is Blank______ to any third party for any contract signed, Blank______.
liable; if the individual exceeds the authority conferred by the principal
A Blank______ will is an instrument that declares an individual's desires to being administered life prolonging treatments.
living
A principal lacks the Blank______ to revoke an agency coupled with an interest at any time.
power
To have proof of partnership existence under the RUPA, co-owners must carry on a business for Blank______
profit
An agency relationship will automatically terminate if any of the following occur except
renunciation.
Brad hires Angelina to be his spokesperson at a campaign event beginning at 8:00PM, but she fails to show up for the event until 9:30. Brad refuses to pay her fee. The best answer is that this agency was
revoked unilaterally when Angelina failed to arrive on time.
A partner has a(n) Blank______ to use partnership property Blank______.
right; for partnership purposes only
Generally, partnership Blank______ and duties always involve partnership Blank______.
rights; property
Starting a business, regardless of its form, is a Blank______ endeavor. Multiple choice question.
risky
One of the most common ways to form a partnership is by an express agreement, which could be merely
shaking hands.
If Sally owns her own business and runs it from her "kitchen table", she is most likely a(n) _____ and is ______ for all her credit card charges.
sole proprietor, personally liable
The easiest business organization to form is a(n)
sole proprietorship.
One of the riskiest steps in forming a new business is raising Blank______ capital.
startup
It is the Blank______ government that decides what requirements need to be in a living will.
state
Suppose Bruce is a buyer for Southern Furniture Company (SFC) and travels to various trade shows on behalf of SFC looking to purchase only specially designated lamp fixtures. The vendors at the shows do not know about SFC. In this case, SFC is a(n) Blank______ and Bruce is a(n)Blank______.
undisclosed principal; special agent
A principal has an obligation to notify third parties about an agency termination in all of the following situations except
when the principal declares bankruptcy.