chapter 38

Lauren, Marcella, and Norell form a syndicate to buy a professional soccer franchise. This syndicate could be set up as

a corporation.

Otto is considering forms of business organization for Pro Tree Service, his landscaping firm. Like most states, Otto's state requires that to form a limited liability company, he must file with a central state agency

articles of organization.

Coco is considering forms of business organization for her concessions business—Coco's Cakes. Most states require that a limited liability company have

at least one member.

Qatar Global Investments is a foreign entity—a firm owned and operated by investors in a foreign country. With respect to a limited liability company in the United States, Qatar Global can

become a member.

StartUp Investors, 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.

Location! Realty LLC is a limited liability company. Like other LLCs, for federal jurisdictional purposes, Location! Realty is most likely a citizen of

every state in which its members are citizens

A limited liability company must be managed by nonmembers.

false

For federal income tax purposes, one-member limited liability companies are not taxed.

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

The alter-ego theory can be applied to a corporation, but not a limited liability company

false

The law governing limited liability companies is uniform.

false

Gabriella is a beneficiary of a business trust. As a beneficiary, she is required to

none of the choices

As the beneficiary of a business trust, Kevin's liability for trust debts and obligations is

nothing

Rafaela Art Gallery and Sequoia Exhibitions form a joint venture. When a dispute arises, Rafaela files a suit against Sequoia. The court is most likely to apply the same principles to this joint venture as it applies to

partnerships

Kalin, Liza, and other consumers form MuniMart Cooperative. This form of business organization makes it possible for these individuals to

pool their resources to gain an advantage in the marketplace.

A limited liability company can be held liable for any loss or injury caused by the wrongful acts or omissions of its members.

true

A limited liability company can be taxed as a partnership.

true

If a limited liability company (LLC) agreement does not cover a topic, the state LLC statute will govern.

true

Most courts apply the same principles to joint ventures as they apply to partnerships

true

The law considers all new, single-owner businesses to be sole proprietorships unless the owner affirmatively adopts some other form.

true