BLAW chpt 12

during the course of a partnership's winding up process the partners owe each other

a duty to disclose all finances of the partnership

partners in a partnership owe each other

a fiduciary duty

a limited partnership is usually dissolved by the bankruptcy of

a general partner but not a limited partner

in most circumstances, a partnership is now treated as

a legal entity

a limited partnership is different from a general partnership because

a limited partnership may only have one general partner

which of the following statements are true

a limited partnership must have at least one general partner

a sole proprietorship comes into existence when

a person begins to do business for herself

which of the following apply to a sole proprietorship

a person is in business for himself

many states now allow groups of doctors in practice together to form a particular legal entity allowed by statute called

a professional corporation

to hold a shareholder meeting, which criteria must be met

a quorum of shareholders must be represented and advance notice of the meeting must be given

a partnership can begin with

a written agreement or an oral agreement or an implied agreement that can be inferred from the conduct of the parties doing business

electing a board of directors, enacting the corporations bylaws and issuing the corporations stock are all things that occur

after the state has issued the corporations certificate of incorporation

a partnership can begin with either

an oral or implied agreement

general partners in a limited partnership

are personally liable to the partnership's creditors

in most states a limited partnership does not have to file what information with the appropriate state official

bankruptcy history of each partner

involuntary dissolution of a corporation is usually caused by

bankruptcy or fraud in the establishment of the corporation

the duty of partners to a partnership is

based on extraordinary trust and loyalty to the partnership

unless the limited partnership agreement hold otherwise when a limited partnership is dissolved the limited partners receive their share of the profits and their capital contributions

before general partners receive anything

the governing committee of a corporation is the

board of directors

limited partners are similar to corporate shareholders in that

both are liable to the extent of their investment

after reviewing a corporations application, the state issues a

certificate of incorporation

dissolution of a partnership takes place, unless otherwise provided for by contract, in the following instances except

change in financial condition of a partner bankruptcy, withdrawal or death of a partner

a ____ is an artificial person or legal entity, created under state law

corporation

coca cola, microsoft and general motors are all examples of

corporations

a reason the corporate status is often chosen is

corporations have the status of a legal person

which of the following is not true about corporate directors

directors must always act to preserve the corporation

a board of directors fiduciary duty of loyalty requires that

directors place the interests of the corporation before their own interests

the process of settling the accounts and liquidating the assets of a corporation is called

dissolution

a complete termination comes about only after the partnership has been ______ and its affairs have been wound up

dissolved

directors are under a _____ to conduct themselves on behalf of the corporation as a reasonably prudent person in the conduct of personal business affairs

duty of care

a corporation is recognized under both federal and state law as a person and

enjoys some of the same rights and privileges accorded to US citizens

a ______ is any name other than the name of the individual who owns the business

fictitious name

______ requires that directors of a corporation place the interest of the corporation before their own interests

fiduciary duty of loyalty

requires that each partner act in good faith for the benefits of the partnership

fiduciary relationship

under traditional common law rules, a partnership

generally was not treated as a single legal entity

the shareholders of a corporation generally have the right to

give a third party the right to vote their shares by proxy

a shareholders relation to creditors of the corporation is generally that the shareholder

has no relation to the creditors

the dissolution of a partnership may occur

if a partner is found to be bankrupt or if a partner dies or if the business of the partnership is made unlawfully

professional corporations are now allowed

in all states

the modern corporation was developed

in the US during the 18th century

in a sole proprietorship, profits are taxed to the

individual owner of the proprietorship

a termination of a corporation

is conducted in two phases: dissolution and winding up and prevents the corporation from taking on any new business and may be brought about either voluntarily or involuntarily

the owner of a sole proprietorship

is legally the same as the business and is taxed the same as the business and may hire any number of employees

A certification of incorporation from the government

is necessary for a corporation to be recognized legally

a limited liability company

is taxed like a partnership and has liability of a corporation

which of the following is not true about a partnership

it is always an independent legal entity

which of the following is not true about the termination of a limited partnership

limited and general partners share assets equally at the same time after the creditors are paid

a business organization in which some of the partners are not liable for partnership debts is called a

limited liability partnership

in a limited partnership the ____ are investors who may not participate in managing the business

limited partners

a business organization made up of 2 or more persons who have entered into an agreement to carry on a business venture for a profit, and not all persons have the right to participate in management decisions is a

limited partnership

shareholders of a corporation have

limited rights to see the corporations books and records vote on matters that may effect a change in the corporations structure

a corporations board of directors hires _____ to run the business

managers

dissolution of a corporation

may be voluntary or involuntary

limited partners are investors who

may not participate in management of the business

in a sole proprietorship, the capital usually

must come from the owner's own resources or be borrowed

the articles of incorporation usually provide all of the following but

names of all shareholders name of CEO address of the corporation and the purpose of the business and classes of stock to be issued are included

unless otherwise stated by contract, the law of partnership presumes which of the following not to be true

only managing partners are fully responsible for debts of the partnership

there are _____ businesses in the US

over 30 million

a disadvantage of the sole proprietorship is often the

owner is personally liable for all the business debts

a corporation separates

ownership from control

in general limited partners lose their limited liability status by

participating in managerial decisions in the partnership

association of 2 or more persons to carry on a business as co-owners for profit

partnership

in the final dispersal of the assets of the limited partnership, creditors rights

precede partners rights

legally, the board of directors is the _____ of a corporation

principle

which of the following statements about a corporation is true? corporations are not entitles to constitutionally protected

privileges against self incrimination

the most common form of business organization is

proprietorship

the oldest and simplest form of business organization is the

proprietorship

the business judgement rule

protects directors and managers of a corporation who have mad honest mistakes in judgement

_____ are those with stock traded on a stock exchange and, therefore, are likely to have many shareholders

publicly held corporations

directors of a corporation may be

removed for cause and be liable for a breach of duty

at a shareholder meeting, important corporate business is presented to the shareholders in the form of _____, which shareholders vote to approve or disapprove

resolutions

the ____ provides "default rules" that determine the operation of partnerships when the partnership agreement is silent or where there is no formal agreement among the partners

revised uniform partnership act

whom of the following must follow a corporations bylaws in conducting corporate activities

share holders directors officer of the corporation

the board of directors of a corporation are elected by

shareholders

the owners of corporation are called

shareholders

a corporation consists of

shareholders, board of directors and officers or managers

the majority of businesses in the us are

sole propietorships

a person doing business for himself or herself is a

sole proprietor

a person doing business for herself is a _____; the business a _______

sole proprietor, proprietorship

a corporation consists of legally distinct groups not including

stakeholders

today a corporation must be created according to

state law

under traditional common law rules, if you wanted to sue a partnership you had to

sue each partner individually

a change in the relationship that shows an unwillingness or an inability to continue with business may bring about ____ of the partnership

termination

a close corporation is one

that has a small number of stockholders

a written partnership agreement typically specifies all of the following except

that the partnership will be established under federal or state law

in a sole proprietorship, the owner is

the business

which of the following are not required to be in certificate of limited partnership

the business positions to be held by each partner

the rules that regulate and govern the internal operations of a corporation are known as

the bylaws

to create a corporation

the corporations articles of incorporations are filed with the appropriate officer of the state

corporations have existed for centuries, but the modern "liberal" general incorporation statutes were first passed in

the late 1800's

a disadvantage of the sole proprietorship form is often

the limited alternatives for raising financial capital

under the uniform limited partnership act, a written agreement must include

the name of the business and they type or character of the business and the contributions of each partner

which of the following is a right of a limited partner in a limited partnership

the right to see the partnership books the right to participate in the dissolution of the business

in general, if a partnership agreement does not specify what happens in case of the death or departure of a partner one looks to

uniform partnership act

a ______ of a corporation involves approval of the shareholders and the board of directors

voluntary

there are two types of dissolution of a corporation

voluntary and involuntary

the dissolution of a partnership occurs

when an event takes place that precludes the partners from continuing in business

the articles of organization filed for a LLC must include

whether it will be managed by its members or by a manger the address of the company or its registered agent whether any members are liable for company debts

if a shareholder supplies needed material to the business then he

will become a creditor of the corporation and will enjoy the same rights of recovery against the corporation as any other creditor

the _____ of partnership affairs involves completing any unfinished business and then collecting and distributing the partnerships assets

winding up