BLAW 11/7

Before any partnership can be considered completely terminated, it must go through the _______ stage and the _______ stage. judicial bond dissolution winding-up continuation

dissolution

When the _______ of the partnership does not violate the partnership _______, we say that the partnership is rightfully dissolved. dissolution conditions continuation agreement

dissolution agreement

At what stage during the life cycle of a partnership does winding-up take place? After performance, but before dissolution After termination, but before dissolution After dissolution, but before termination Never, this only occurs in corporations.

After dissolution, but before termination

Which of the following is a written agreement that creates a partnership? Articles of association Offer of association Articles of partnership Offer of partnership

Articles of partnership

Which of the following is a written agreement that creates a partnership? Offer of partnership Articles of association Articles of partnership Offer of association

Articles of partnership

______ authority permits partners to enter into agreements necessary to carry on partnership business. Equitable Implied Symbolic Constructive

Implied

What type of liability does a new partner have for any partnership obligations that occurred before he or she was added? Strict Unlimited Limited Unconditional

Limited

Which of the following is not an implied property right of a partner? The right to participate in the management of the business The right to specific partnership property The right to their partnership interest The right to any intellectual property he or she creates while a partner

The right to any intellectual property he or she creates while a partner

Which of the following is not an implied property right of a partner? The right to their partnership interest The right to participate in the management of the business The right to specific partnership property The right to privileges and benefits based on seniority

The right to privileges and benefits based on seniority

What kind of vote is required for partners to change some element of their partnership agreement, admit new partners, or alter the nature of their business? Majority Unanimous Secret ballot Super-majority

Unanimous

What kind of vote is required for partners to change some element of their partnership agreement, admit new partners, or alter the nature of their business? Super-majority Secret ballot Majority Unanimous

Unanimous

Which of the following is an accurate statement regarding a partner's right to compensation? A partner's right to compensation is governed by Article 2 of the Uniform Commercial Code. A partner's right to compensation is governed by Article 3 of the Uniform Contract Code. According to common law principles, each partner is entitled to receive a fair salary for participation in partnership-related business activities. Unless otherwise agreed, no partner will receive a salary for participation in partnership-related business activities.

Unless otherwise agreed, no partner will receive a salary for participation in partnership-related business activities.

A(n) _______ agreement that creates a partnership is called the ______ of partnership. formation articles written compensation

articles written

According to the UPA, a partnership is a(n) ______ of two or more persons to carry on as ______ in a business for profit. incorporation; co-owners association; employees association; co-owners incorporation; employees

association; co-owners

Partners owe a(n) ______ duty and a duty of ______ to each other. care compensation accounting fiduciary

care fiduciary

The articles of partnership agreement typically includes the ______ of the partnership, such as the date or event that signals the agreement's expiration, or should make the partnership's term indefinite. corporation status certification corporate form duration

duration

If the partnership agreement does not indicate to the contrary, partners share ______ in profits and losses. equally disparately, according to partner age equitably disproportionately, according to seniority

equally

Both the Uniform Partnership Act and the Revised Uniform Partnership Act govern partnerships in the absence of a(n) ______ partnership agreement. corporate equitable express implied

express

Each partner has the right to receive full information regarding partnership matters. This right corresponds to the partners' ______ duty to disclose any information affecting the partnership. fallacious fabricated functional fiduciary

fiduciary

Because of the nature of the partnership, partners generally have greater ______ authority than do typical agents. implied constructive symbolic equitable

implied

Partners have a(n) ________ duty which forms the basis for the right to ______. sue fellow partners inspect the books implied fiduciary

inspect the books fiduciary

The three property rights of partners include the right to participate in the ______ of the business, the right to specific partnership ______, and the right to their partnership ______. (Check the THREE correct answers) interest property management compensation

interest property management

A partnership is often considered a(n) ______ for _______ purposes. (Choose TWO best answers) lawsuit legal entity estoppel entity aggregate

lawsuit legal entity

When a partnership adds another partner, the new partner assumes ______ liability for any obligations that occurred before she was added. limited no personal unlimited

limited

According to the UPA, if a partnership is liable, each partner is _______ liable, with ______ liability. personal primarily unlimited joint

personal unlimited

The _______ of partnership agreement typically states the division of ______ as well as ______. profits duties articles compensation

profits articles

According to the right of ______, the rights in specific partnership property pass to the surviving partners. intestacy survivorship replevin hereditament

survivorship

Partners own partnership property as ______. tenants in property joint tenants in common partners in property survivors in property

tenants in property

Any property brought into or acquired by the partnership is considered property of: _______. partnership shareholders the partnership trustee the partnership the individual partners

the partnership

Partners have the power to dissolve the partnership at any time because: _______. it makes it easier for the partners to avoid having to comply with agreements they made with third parties state statutes allow for the partners to dissolve the partnership the courts prefer that partnerships decide when to terminate their relationships, rather than putting the burden on the courts the partnership is a voluntary relationship

the partnership is a voluntary relationship

Unless otherwise agreed, no partner will receive ______ for participation in partnership business, regardless of the _______ expended. time and effort extra ownership interests legal rights and duties payment

time and effort payment

When can a partnership be rightfully dissolved? (Check all that apply.) By agreement that it will terminate after the partnership completes its purpose By consent of all of the partners When a partner dies By a third party complaining to the court that the business is not performing satisfactorily When a partner is incapable of carrying out the duties established by the agreement

By agreement that it will terminate after the partnership completes its purpose By consent of all of the partners When a partner dies When a partner is incapable of carrying out the duties established by the agreement

_______ is complete when any partner stops fulfilling the role of a partner to the business (by choice or default). Continuation Winding-up Dissolution Termination

Dissolution

At what stage during the life cycle of a partnership does winding-up take place? Never, this only occurs in corporations. After performance, but before dissolution After termination, but before dissolution After dissolution, but before termination

If the partnership business engages in an activity that suddenly becomes illegal If a partner dies If a partner is adjudicated bankrupt

A partnership can be dissolved when a partner applies to the court to dissolve the partnership for any of the following reasons: _______. (Check all that apply.) The partners dislike each other and cannot get along A partner is incapable of carrying out his or her duties as established by the partnership agreement It becomes impractical to carry out the business of the partnership (continuing will only result in lost profits) A partner is adjudicated as insane

A partner is incapable of carrying out his or her duties as established by the partnership agreement It becomes impractical to carry out the business of the partnership (continuing will only result in lost profits) A partner is adjudicated as insane

Which body of law states that partners have the authority to bind a partnership in an agreement? The Bilateral Partnership Code The Uniform Commercial Code The Unilateral Partnership Act The Uniform Partnership Act

The Uniform Partnership Act

Approximately how many states have adopted the Revised Uniform Partnership Act? Three-quarters One-quarter One-half One-third

One-half

Which of the following is not a situation in which a partnership is considered a legal entity? When the partnership is sued or being sued When the partnership holds title to property that individual partners do not own When the partnership compels individual partners to adhere to the doctrine of posse comitatus When marshaling partnership assets

When the partnership compels individual partners to adhere to the doctrine of posse comitatus

A partnership is: _______. a creation by the court system where a court must declare the existence of a partnership an entity that is created by state statute formed when the necessary paperwork is filed with the Secretary of State a voluntary and consensual relationship

a voluntary and consensual relationship

According to the ______ partners owe each other, partners must work for the benefit of the partnership and not engage in any action or business that could _______ or _______ with the partnership. (Check THREE correct answers) undermine fiduciary duty compete accounting duty

undermine fiduciary duty compete

Felipe and Gary entered into a partnership to build an elaborate patio. Once the patio was completed, Felipe and Gary were no longer partners. This type of partnership dissolution is known as dissolution: _______. by incapacity of one of the partners by operation of law upon a particular date in time upon achieving a certain objective

upon achieving a certain objective

The partnership ______ will indicate how a partner can ______ and end their association with the other partners. withdraw agreement association windup

withdraw agreement

Which of the following entitles a partner's personal creditor to the partner's profits, while the partner continues to act as a partner and engage in the partnership business? A summary judgment A charging order A declaratory judgment A preliminary injunction

A charging order

Under the doctrine of ______ assets, partnership assets are arranged in a certain order to pay any outstanding _______. debts assets non-negotiable partners

debts assets

According to the UPA, general ______ principles establish that partners have the authority to bind a partnership in an agreement. corporate agency equity employment

agency

According to the UPA, general ______ principles establish that partners have the authority to bind a partnership in an agreement. liability implied agency tort

agency

Absent an agreement to the contrary, a partnership ceases to exist when one of the partners dies, and the partnership is then considered a legal ________of the individual surviving partners.

aggregate

Absent an agreement to the contrary, a partnership ceases to exist when one of the partners dies, and the partnership is then considered a legal _____of the individual surviving partners.

aggregate

When partnership debts eventually become the debts of the individual partners, the partnership is considered a legal _____of the partners.

aggregate

A written ______ that creates a partnership is called the articles of partnership. condition subsequent offer condition precedent agreement

agreement

According to the UPA, a partnership is a(n) ______ of two or more persons to carry on as ______ in a business for profit. association; co-owners incorporation; co-owners association; employees incorporation; employees

association; co-owners

As a general rule, partners have the power to dissolve the partnership: _______. only at such time that the court declares the partnership can be dissolved only if one partner is not in agreement with the dissolution at almost any time at no time; only the court can dissolve the partnership

at almost any time

A partnership ______ allows the parties to withdraw at any time for _______ from the agreement. by operation of law at will sufficient compensation any reason

at will any reason

A partnership ______ allows the parties to withdraw at any time for _______ from the agreement. sufficient compensation by operation of law at will any reason

at will any reason

According to the UPA, a partnership is an association of two or more persons to carry on as co-owners in a(n) ______ for ______. business; profit corporation; tax savings corporation; profit business; tax savings

business; profit

Suppose Ian and Jackie have a partnership. If Jackie is declared by the courts to be insane, then the partnership is dissolved: _______. because this was an at-will partnership by wrongful dissolution by an act of the court by the act of the parties

by an act of the court

If a partner can no longer carry out their duties as assigned, the partnership: _______. must do business in another state must notify the Secretary of State can be rightfully dissolved must be converted to a sole proprietorship

can be rightfully dissolved

A partner's interest is composed of a combination of the following: _______, which can be sold to a(n) _______. (Choose TWO correct answers) creditor share of the profits actual authority to be an agent return of a capital contribution

creditor share of the profits return of a capital contribution

A partnership is terminated when it completes the: _______. dissolution and winding-up phase winding-up phase only dissolution phase only notification and closing of accounts phase

dissolution and winding-up phase

Partners can agree to _______ a partnership once a certain _______ has been achieved. (Choose ALL that apply) dissolve objective terminate breach

dissolve objective terminate

One way a partnership can be dissolved is when the partners have agreed to: _______. change the nature of the business of the partnership change the name of the partnership share the profits and losses between the partners dissolve the partnership at a particular time

dissolve the partnership at a particular time

In a two individual partnership, the partnership is ______ when one individual dies. continued formed affirmed dissolved

dissolved

The winding-up phase consists of taking account of the assets of the partner who has left and: _______. providing third parties with the right of first refusal to purchase those assets putting them up for auction and distributing the proceeds to the other partners distributing them among the other partners distributing those assets to any beneficiaries of that partner

distributing them among the other partners

The articles of partnership agreement typically includes the ______ of the partnership, such as the date or event that signals the agreement's expiration, or should make the partnership's term indefinite. corporate form corporation status duration certification

duration

According to the UPA, if a partnership is liable, ______ unlimited personal liability. only the partnership has each partner has only founding partners have only senior partners have

each partner has

If a partner dissolves the partnership in violation of the partnership agreement, the partner can be held: _______. in criminal detention for the wrongful dissolution of the partnership in contempt of court for wrongful dissolution liable for failing to prevent the partner from engaging in wrongful dissolution liable for the wrongful dissolution of the partnership

liable for the wrongful dissolution of the partnership

If a partner dissolves the partnership in violation of the partnership agreement, the partner can be held: _______. liable for failing to prevent the partner from engaging in wrongful dissolution liable for the wrongful dissolution of the partnership in contempt of court for wrongful dissolution in criminal detention for the wrongful dissolution of the partnership

liable for the wrongful dissolution of the partnership

Most partnership decisions are made by ______ vote. super-majority secret ballot unanimous majority

majority

One consequence of a partner who intends to withdraw or dissolve the partnership is that the partner: _______. no longer has the implied authority to bind the partnership no longer has the actual authority to bind the partnership can immediately withdraw from the partnership no longer can be a part of any other partnership

no longer has the actual authority to bind the partnership

According to the duty of ______, partners must honor the partnership agreement; if they fail to honor the agreement, they can be held liable for any losses. obedience abeyance honor trust

obedience

According to the duty of ______, partners must honor the partnership agreement; if they fail to honor the agreement, they can be held liable for any losses. obedience abeyance trust honor

obedience

Unless otherwise stated in the partnership agreement, _______ the partners have the right to _______ in the management of the partnership. participate equally the majority of participate by ownership depending on pro-rata interests all

participate equally all

According to the UPA, a ______ is an association of two or more persons to carry on as co-owners a business for profit. limited liability company partnership sole proprietorship corporation

partnership

If the ______ agreement does not indicate to the contrary, ______ partners share in both profits and losses. no partnership some all

partnership all

When a partnership agreement does not specify the objective or duration of the partnership, we say that this is a(n): _______. partnership at will partnership by court order partnership by statute de facto partnership

partnership at will

A partner's ______ cannot seize specific items of partnership property. charging order personal friends personal creditors actual agents

personal creditors

If the partnership agreement does not indicate to the contrary, all partners share equally in losses, but not profits. revenue and expenditures. profits and losses. profits, but not losses.

profits and losses.

A partner's interest is composed of a combination of the following: _______, which can be sold to a(n) _______. (Choose TWO correct answers) return of a capital contribution share of the profits actual authority to be an agent creditor

return of a capital contribution share of the profits creditor

If a partner withdraws from the partnership in accordance with the partnership agreement, then this kind of dissolution is a(n): _______. rightful dissolution wrongful dissolution dissolution by operation of law void

rightful dissolution

According to the right of ________, the rights in specific partnership property pass to the _______. (Choose TWO correct answers)

survivorship surviving partners

The _______ may simply agree to _______ a partnership agreement at any time. dissolve terminate creditors partners

terminate partners

Since a partnership is considered a legal aggregate of the partners, both the partnership and its partners are immune from taxation on the income generated through the partnership. the partnership is taxed as a separate being, and the partners pay taxes on the income generated through the partnership. the partnership is taxed as a corporation, and the partners are immune from taxation on their income to avoid double-taxation. the partnership is not taxed as a separate being; instead, the partners pay taxes on the income generated through the partnership.

the partnership is not taxed as a separate being; instead, the partners pay taxes on the income generated through the partnership.