legal studies
which of the following are advantages of operating as a partnership?
- Forming a partnership is simple and relatively inexpensive. - Partnerships are not taxed.
which of the following provisions are typically in an operating agreement for a limited liability company?
How membership interests may be transferred. whether dissociation of a member such as the death or departure will trigger dissolution of the LLC
which statement is true about creating a sole proprietorship
No documentation is required to create a sole proprietorship.
which of the following is a disadvantage of operating as a partnership
Partners may suffer financial loss if the partnership is not profitable.
a corporation that is formed in one state but does business in another state is referred to in the second state as
a foreign corporation
what tax options are available to a LLC
an LLC with only one member can choose to be taxed as a corporation or a sole proprietor. an LLC with two or more members can choose to be taxed as a partnership or a corporation.
which of the following is a requirement for the formation of a LLC
articles (or certificate) of organization
what are three ways in which a partnership can be dissolved?
by a fixed term in the partnership. by operation of law. by an act of the partners
a partnership in which the liability is shared between all of your partners together or one or more individual is called?
joint and several liability
the simplest form of business to establish is a.
sole proprietorship
what documents spells out the powers of a corporation
the bylaws. the charter.
the legal effects of dissociation of a member of a LLC include
the dissociated members duty of loyalty to the LLC terminates. the dissociated member loses the right to participate in management
who is liable for contracts entered into on behalf of the corporation before the corporation is formed
the promoter
In ordinary circumstances. when the corporate veil has not been pierced a shareholder may be liable for
unpaid amounts on the shares held by that shareholder
in a distributorship
a manufacturer licenses a dealer to sell its product
which of the following is a requirement for the initial formation of a corporation
articles of incorporation
most limited liability company statue's provide that unless the articles of organization specify otherwise an LLC is assumed to be managed by
it's members
which of the following is a duty of both corporate directors and corporate officers
making a full disclosure of potential conflicts of interest
which of the following rights may a member of a LLC transfer to a non member
sharing the companies financial profits
what is true of the liability for loss or injury caused by the wrongful acts or omissions of the members of limited liability companies?
the LLC as an entity can be held liable but members themselves are not personally liable
a sole proprietorship differs from a limited liability company LLC in
the documentation required for formation.
which of the following provisions are typically in a charter/article of incorporation for a corporation
the intended business purpose of the corporation. the name and address of the corporations agent.
what type of corporation is formed for the purpose of doing a public service instead of making money.
non profit
common shareholders have the right to vote on
proposals for fundamental changes affecting the company such as mergers or liquidation.
a sole proprietorship differs from a partnership in
the number of owners
an operating agreement for a limited liability company
typically includes provisions about choosing the LLC's management
when a new partner joins a previously existing partnership the new partner is personally liable for
only obligations after becoming partner
which of the following documents spells out the rights and duties of the members of a limited liability company(LLC)?
operating agreement
which of the following are rights of common stockholders?
opportunity to inspect corporate books and records. transferable ownership. voting on matters such as election of directors and proposals for mergers or liquidations
what is true
members of an LLC may stipulate in their operating agreement that certain events will cause dissolution. a court may order the dissolution of an LLC under certain circumstances such as the members engaging in illegal conduct.
