BSAD 324 Test 3 Quizzes

With respect to a corporation, a director is ______

a fiduciary

Sweetwater Corporation is incorporated in TexasOutside that state, within the United States, the firm is ______

a foreign corporation

Building Corporation and Construction Inc. combine so that only Construction continues to exist. This is ______

a merger

Olivia is a partner in Pacific Trade. In the majority of states, with respect to any partnership obligations that Olivia does not participate in, know about, or ratify, she would be liable for ______

all of the obligations, jointly and severally

The number of directors that serve on a corporate board is determined by its ______

articles of incorporation

To bring a corporation into existence requires securing a corporate name that is ______

available as a domain name, subject to state approval

Brent and Char are limited partners in Dental Center, a limited partnership. In terms of the firm's books and information regarding partnership business, Brent and Char are entitled to ______

complete access

With respect to a corporation, an officer's rights are defined by ______

employment contracts

Auto Company's liabilities exceed its assets. The firm hires Bass, an accountant, to prepare a balance sheet. Through negligent omissions, the sheet shows a net worth Credit Bank relies on the document to make a loan to Auto. When the firm defaults the bank files a suit against Bass. Bass is most likely ______

liable if the accountant knew the bank would rely on the balance sheet

Accounting LLC is a member-managed limited liability company. Unless the members have agreed otherwise, all decisions with respect to the firm's business are made by ______

majority vote

Bayard organized, and owns and operates, Cypress Tours in the simplest form of business organization. This is ______

none of the choices

Gil is an officer for HVAC Corporation. Due to Gil's choice of a certain supplier, HVAC's costs are somewhat higher than they might have been if a different supplier had been chosen. Gil is most likely liable for breach of ______

none of the choices

When a vacancy occurs on a corporate board, how the position will be filled is most likely set forth in ______

the corporation's articles or bylaws

Daisy is a director of Excavation Corporation. She opposes an offer to merge Excavation with Fill Inc. because she would lose her board position. Daisy is most likely liable for breach of ______

the duty of loyalty

In most situations, with respect to a limited liability company's debts, the firm's members are shielded from ______

the loss of their capital investment in the firm

Dain is a limited partner in Eco Baits, a pest control service organized as a limited partnership, which cannot pay its debts. Dain is liable for the debts ______

to the extent of his capital contribution to the firm

Dean, a partner in Equipment Sales, applies for a loan with Farmers Bank allegedly on Equipment's behalf but without the authorization of the other partners. The bank knows that Dean is not authorized to take out the loan. Liability in the event of default will be imposed on ______

Dean

Dynamo Corporation combines its assets and liabilities with those of Energy Company to form Fuel Inc. Dynamo and Energy cease to exist. The formation of Fuel Inc. is ______

a consolidation

Most states provide that the minimum number of directors that must be present before the board may transact business is ______

a majority of the number authorized in the articles or bylaws

A limited liability company that wants to distribute profits to its members could avoid "double taxation" by electing to be taxed as ______

a partnership

Eton owns Fast Freight Company. He uses the firm's funds to pay his personal expenses, creates Go Trucking Inc. to engage in the same business, transfers Fast Freight's assets to Go Trucking, and petitions Fast Freight into bankruptcy. This most likely warrants ______

a pierce of the corporate veil

Carmen and Diego are shareholders of Espresso Inc. Carmen's written authorization to Diego to vote her shares at a shareholders' meeting is ______

a proxy

Bayside Restaurant LLC is a limited liability company. Its sole member is Conrad. For federal income tax purposes, unless the firm indicates otherwise, it will automatically be taxed as ______

a sole proprietorship

Without creating a separate business organization, Rey starts up Street Cruisers, a pre-owned auto sales enterprise. This enterprise is ______

a sole proprietorship

Carl starts up, and assumes the financial risk of, DataWorks, a new Web marketing enterprise. Carl and DataWorks must meet legal requirements relating to ______

all of the choices

Limited liability business forms, such as LLCs, LPs, and LLPs, offer tax advantages that are similar to those offered by ______

an S corporation

A corporation is ______

an artificial legal person

"A reasonably competent general practitioner of ordinary skill, experience, and capacity" is the normal standard of performance expected of ______

an attorney

Bhat and Cho do business as Data Security, a partnership. In most states, for the purposes of collecting judgments and having accounting performed, this firm would be treated as ______

an independent entity

Nell is considering forms of business organization for Optic Center, a medical eye clinic. An advantage of a limited liability partnership is that, depending on the applicable state statute, partners can avoid personal liability for ______

any partnership obligation

The primary document needed to incorporate a business is the ______

articles of incorporation

Ensure Care LLC's owners are Fez and Guan. As a limited liability company, Ensure Care enters into contracts ______

as a legal entity apart from its owners

Global Capital S.A. Is a foreign investor. With respect to the operations of a limited liability company in the United States, Global can ______

become a member

Initiating and negotiating the sale and lease of corporate assets outside the regular course of business is a responsibility of the corporation's ______

board of directors

Kay and Leo form Metro Delivery Inc. Responsibility for all policymaking decisions necessary to the management of corporate affairs rests with Metro's ______

board of directors

Cathy, Don, and Ethel are partners in Fruit Orchard Farms. Cathy gives notice to quit the firm, which otherwise continues to do business. This is ______

dissociation

Ling owns and operates Metro Delivery Service as a sole proprietorship. When she dies, the business will automatically ______

dissolve

Start-Up LLC is a limited liability company without a written operating agreement. Among the members, a dispute arises concerning the division of profits. Under most LLC statutes, the profits will be ______

divided equally among the members

An accountant is least likely to be held liable for accounting fraud if he or she ______

fails to discover every impropriety in a client's books

Kathy is a director of Line Production Inc. As a director, with respect to the corporation, Kathy is expected to subordinate ______

her personal interests to the corporation's welfare

Gwen and Hera do business as G&H Civil Engineers, a partnership. The Uniform Partnership Act governs the firm ______

in the absence of an express agreement

Data Analytics LLC is a limited liability company. Unless the firm's articles of organization specify otherwise, it will most likely be assumed that the firm is ______

member-managed

Ben is an accountant whose clients include Capital Inc. Under the Ultramares rule, if Ben is negligent in his work for Capital, he could be liable to the client and ______

no third party with whom the accountant is not in privity or "near privity"

Deb and Eve are partners in Foundations, a construction outfit. Deb manages the business. For this service, unless the partnership agreement states otherwise, she is entitled to pay in proportion to her ______

none of the choices

Amber owns and operates Bistro Café in space leased in a building owned by Ciera. The lease requires a base rent of $1,500, plus 10 percent of Bistro's profits, each month. The term is two years. Amber and Ciera are ______

not partners, because Ciera does not have an ownership interest or management rights in Bistro

Ford is the sole proprietor of Go, a game subscription service. As a sole proprietor, on the business's profits, Ford pays ______

only personal income taxes

To gain an advantage in a business deal, Masonry LLC engages in fraud. Nicole, a member of Masonry, significantly contributes to the firm's misconduct. For any resulting damages, a court is most likely to hold Nicole ______

personally liable

Most likely to appear in the articles of incorporation are the names of the company's initial ______

registered office and agent

The first step in the incorporation of a business firm is to ______

select the state of incorporation

A corporation's authority to act and its liability for those actions is, with respect to the firm's owners, ______

separate and apart

Among the states, the law governing limited liability companies is far from uniform because ______

state limited liability company statutes vary from state to state

An attorney's conduct is governed by rules of professional conduct established by the state in which he or she is licensed, and the Model Rules of Professional Conduct of ______

the American Bar Association

Sara and Tim form Urban Foods Inc. When it comes to managing Urban, the firm relies on ______

the board of directors

The day-to-day operations of a corporation are overseen by ______

the officers

Brad and Carol are partners in Doctors for Children, a medical clinic. Brad's dissociation from the firm results in ______

the partnership's buyout of Brad's interest in the firm

Vaughn starts Wind Systems to make and sell turbines. Later, Vaughn contracts with Xi to invest additional capital in the firm in exchange for 25 percent of the profits. Vaughn and Xi are not partners in Wind Systems because ______

they do not have joint control over the business

Bee is an accountant whose clients include Concessions Inc. If Bee is negligent in her work for Concessions, most courts would hold her liable to the client and ______

third parties who are "reasonably foreseeable" users of the work

Corporate shareholders will most likely be held personally liable for the firm's debts if they ______

use the firm to perpetrate a fraud