MGT 200 CHAPTER 13

wrongful dissociation

A partner withdrawing that violates the partnership agreement or if a partner withdraws before the agreed-upon expiration are examples of

proprietorship

A partnership is taxed like a sole _________ which means the partnership itself does not pay taxes, but rather taxes are accounted for on individual partner tax returns.

limited

A(n) _________ partner is also referred to as an investing principal

c. is personally liable to pay damages to the injured party

If a limited partner commits an illegal or negligent act on behalf of the limited partnership, the limited partner a. is personally liable to pay damages to the injured party, but only up to $10,000. b. will equally share personal liability with the other general and limited partners. c. is personally liable to pay damages to the injured party. d. is only liable to the third party to the extent of the limited partner's contribution.

jeopardize the limited partnership status

If a limited partner engages in activities reserves for general partners, the limited partner may

individual partner's tax rate

In a limited partnership, tax is paid based on the

limited

In a limited partnership, the ______ partner's liability is limited to what he or she contributed to the business

a. limited to the extent of the limited partner's contribution in the business

In a limited partnership, the limited partner's liability is a. limited to the extent of the limited partner's contribution in the business. b. that the limited partner is personally liable for debts of the partnership. c. limited to 25% of the partnership debt. d. shared equally among all limited and general partners.

faith

The good ________ standard requires partners to exercise appropriate care when conducting partnership business

general

A __________ partnership is typically defined as an association of two or more people or entities who are co-owners and co-managers of a business and share in the profits of an ongoing business operation.

joint

A __________ venture is a limited-in-time business relationship typically governed by the same legal principles as a general partnership.

franchisor

A business entity with a proven track record of success who sells to another party the right to operate the business and use the business's trade secrets, trademarks, products, and so on is called a ______.

general partnership

A joint venture is typically governed by the same legal principles as a

illegal

A limited partner will lose his or her limited liability protection for engaging in a negligent or ________ act while acting within the scope of partnership duties.

franchise

An arrangement of a continuing commercial relationship for the right to operate a business pursuant to the franchisor's trade name or to sell the seller's branded goods is a(n):

partnership

Approximately forty states have adopted all or substantial portions of the Revised Uniform ________ Act.

partnerships

Limited and general are the two traditional subcategories of which of the following business entities?

silent

Limited partners are sometimes referred to as _______ partners

pass-through

Limited partnerships are ________-_______ entities or tax purposes, meaning the entity itself does not pay taxes

b. fiduciary duties owed by partners

Loyalty, care, and good faith are a. contractual duties owed by partners b. fiduciary duties owed by partners c. common law duties owed by partners d. constitutional duties owed by partners

implied

Parties who may not intend to become partners can still have liability as partners through a(n) ___________ partnership.

partnership

Principal funding and commercial lenders are viable funding options for a general

a. owner's resources

Sole proprietorships are typically funded through a. owner's resources b. partner resources c. issuing bonds d. issuing stock

Uniform commercial code

States that have not adopted the RUPA follow the provisions found in the

uniform partnership act

States that have not adopted the RUPA follow the provisions found in the

contractual

The RUPA provides that partners have the power to bind the partnership to _______ obligations regardless of the knowledge of the other partners

franchise

The franchisor and franchisee are typically governed by the ______ agreement.

True

True or false: A partnership may not sell ownership rights through the public markets.

False

True or false: A written partnership agreement is required for an entity to be able to exist as a partnership.

False

True or false: To form a general partnership, a formal document must be filed with the government

False

True or false: To form a general partnership, a formal document must be filed with the government.

general partnership

Two or more people operating as co-owners of a business for profit is called a

equal

Under RUPA, unless the parties otherwise agree, all partners receive how much of a share of the profits and losses?

at least one general partner remains

Under the RULPA, a general partner may withdraw from a limited partnership so long as all partners agree in writing to continue the partnership and

separation

Voluntary ______ occurs when a partner gives notice of intent to withdraw from the partnership

dissociation

Voluntary separation, expulsion, and a partner's incapacity are recognized events under RUPA that are considered to be events of

securities

When a limited partnership interest is sold to the public, the transaction is subject to federal and state ________ laws

withdrawal

When a principal desires to leave a limited partnership, the RULPA defines this act of separation as:

dissociation

When a principal wishes to leave a partnership, the RUPA defines this act of separation as which of the following:

certificate of limited partnership

When forming a limited partnership, name, address, and partner capital contribution are typically items found in the

sole proprietors

When it comes to liability, general partners are personally exposed to liability similar to:

a. general partnership

Which of the following does not require a form to be filed with a government agency? a. general partnership b. limited liability partnership c. corporation d. limited liability company

b. a partner's personal assets are subject to partnership debt

Which of the following is a correct statement regarding general partner liability under general partnership law? a. Not all partners will be liable for partnership debts. b. A partner's personal assets are subject to partnership debt. c. A partner's personal assets are exempt from partnership debt.

a. inspect financial records of the business

Which of the following is a limited partner entitled to perform? a. Inspect financial records of the business b. Participate in the day-to-day management of the business c. Supervise employees d. Participate in the day-to-day operations of the business

express

Which of the following is a partnership where the principals agree to an ongoing business relationship?

a. selling ownership rights through the public markets

Which of the following is not a way in which a limited partnership can be funded? a. Selling ownership rights through the public markets b. Borrowing from a commercial lender c. Selling a percentage of ownership rights in the partnership and any profits in the business d. Borrowing money from the general and limited partners

pass through

Which of the following is used to describe an entity, that, for tax purposes, means that the partnership entity pays no level of corporate tax.

contribute expertise

Which of the following may a limited partner perform a limited partnership?

a. contribute expertise

Which of the following may a limited partner perform for a limited partnership? a. Contribute expertise b. Make day-to-day management decisions c. Supervise employees d. Bind the partnership

a. sole proprietorship

Which of the following requires no annual filing? a. sole proprietorship b. limited liability company c. corporation d. limited liability partnership

LP

Which of the following typically used to denote a limited partnership?

general

Which type of partner is also referred to as a managing principal?

winding up

________ ___ is triggered when the principals wish to dissolve the partnership after dissociation