Chapter 17 Test 3
A limited liability company is a citizen of every state
False
Every limited liability company is a citizen of every state
False
Foreign investors cannot participate in a limited liability company
False
Generally, a dissociated member of a limited liability company (LLC) has the right to buy his or her interest in the LLC from the other members
False
Generally, if a member dissociates form a limited liability company (LLC), the other members cannot continue to carry on the LLC's business
False
In a limited liability company, the management may consist of members or nonmembers, but not both.
False
In a limited partnership, every partner has full responsibility for the partnership and for all its debts
False
In many states, an operating agreement is required for a limited liability company to exist
False
In most states, a limited liability company can have only a limited number of members
False
In most states, a limited liability company must have at least two members
False
Limited liability companies cannot enter into contracts or hold title to property.
False
Most states apply to a limited liability company (LLC) formed in another state the law of the state where the LLC currently does business.
False
Normally, a member who dissociates from a limited liability company (LLC) has the right to force the LLC to dissolve
False
The alter-ego theory cannot be applied to a limited liability company
False
The death of a limited partner dissolves a limited partnership
False
The owners of a limited liability company are liable for the obligations of the firm to the full limit
False
To form a limited liability company, articles of organization must be filed with the federal Small Business Administration
False
Under most limited liability company statutes, if the members do not specify how profits will be split, they are divided in proportion to the members' capital investment
False
When a limited liability company is dissolved, any member, including those who wrongfully dissociated, may participate in the winding up process
False
If a dispute arises and the applicable limited liability company statute does not cover the issue, a court will most likely dismiss the case
False
The members of a limited liability company have unlimited liability for any loss or injury caused by the wrongful acts or omissions of the firm
False
Generally, there are no restrictions on the dissociation by any partner from a limited partnership.
False
A limited liability company can be taxed as a corporation
True
A limited liability limited partnership is a type of limited partnership
True
A limited liability partnership must be formed in compliance with state statutes
True
A limited partnership can be dissolved by court decree.
True
Generally, each state limits the liability of partners in a limited liability partnership in some way
True
In a limited liability limited partnership, a general partner has the same liability as a limited partner in a limited partnership
True
In a limited partnership, a general partner's dissociation from the firm normally will lead to dissolution unless all partners agree to continue the business.
True
In a limited partnership, limited partners do not have the same rights as general partners to participate in management.
True
Limited liability company operating agreements can provide whether formal members' meetings will be held
True
Members of a limited liability company (LLC) can stipulate in their operating agreement how managers will be chosen or removed
True
Members of a limited liability company can stipulate in their operating agreement how voting rights will be apportioned
True
Some states have passed laws prohibiting the withdrawal of limited partners from a limited partnership
True
Typically, the articles of organization of a limited liability company (LLC) include information on how the LLC will be managed
True
