Bus Law Quiz - Ch19
CPA Accounting, LLC, is a limited liability company. If the law in CPA's state is like the law in most states, unless the members have agreed otherwise, participants in the firm's management will be considered to include
All members
In a limited liability company, members cannot participate in its management.
False
A partner may use partnership property for any purpose without accounting to the partnership.
False - must consult other partners
A limited partner has a right to participate in the management or operation of the partnership.
False, has NO right to participate
A limited liability company is operated in compliance with state law.
True
A sole proprietor may own and manage any type of business.
True
An operating agreement for a limited liability company need not be in writing.
True
In most states, a general partner is jointly and severally liable for all partnership obligations.
True
In some states, business trusts pay corporate taxes.
True
Most franchise agreements provide that termination must be "for cause."
True
One of the disadvantages of a sole proprietorship is that the owner is liable for the losses of the business.
True
Cal sells "DownSize," a weight-reduction program, from a Web site, in competition with Eat-Less Inc.'s product "Fit 'n Trim." Eat-Less files a suit against Cal, alleging in part that he is a sole proprietor, but his enterprise should be deemed a different form of business. Cal's enterprise should most likely be considered
a sole proprietorship because Cal is a sole proprietor.
Guy and Hanna do business as G-H Associates. If G-H is a partnership, it is governed by the Uniform Partnership Act
in the absence of an express agreement.
Leigh wants to go into the business of construction contracting. Among the reasons that would probably convince Leigh to set up his business as a sole proprietorship would be
its greater organizational flexibility.
Tundi is a partner in WooHoo! Amusement, a new partnership. A WooHoo! debt comes due. Tundi is
personally liable to the full extent of the debt.