MGT FINAL
Which of the following statements concerning a Chapter 11 reorganization plan is true?
. A reorganization plan can be confirmed by the court over objections of somecreditors if the court determines that the plan is feasible and fair.
Which of the following is NOT a requirement for an involuntary Chapter 7 bankruptcypetition?
. None of the above is a requirement for an involuntary Chapter 7 bankruptcypetition.
Under what circumstances might the court reject a bankrupt debtor's Chapter 13 plan?
. The plan anticipates paying the unsecured creditors less than what they would getunder Chapter 7.
Wedney Inc. sold a meat processing machine to Yoro Chickens taking a security interestin the machine. Yoro Chickens defaulted on the loan.Wedney repossessed the machine.Wedney would like to retain the machine to use as a model. Which of the followingstatements iscorrect?
. Wedney must notify the debtor that it intends to retain the machine and give Yoro20 days to object.
Landscaper Lottie used her machinery employee labor and her expertise to landscapeOpal's new guest home. Opal fails to pay for the landscaping because she has run out ofmoney. Lottie files a lien against the real property. This lien is called
. a mechanic's lien; it was created by improving real property.
If repossessed collateral is sold or otherwise disposed of by the creditor the time placemanner and method of disposal must be:
. commercially reasonable.
Debts that cannot be discharged in bankruptcy include all EXCEPT
. negligence judgments.
The correct order of payment of claims from the bankrupt debtor's estate would be:
. secured claims, priority claims, unsecured claims.
Kathleen filed for voluntary bankruptcy and the automatic stay went into effect. Theautomatic stay:
. stops any and all acts to collect, assess, or recover a claim against Kathleen thatarose before she filed bankruptcy.
To perfect a security interest in a negotiable instrument Second State Savings and Loanshould:
. take possession of the instrument
Which of the following characteristics is that of a closely held corporation?
. the shares are not publicly traded.b. the corporation can typically operate without a board of directors.c. the shareholders usually restrict share transfer.d. all of the above.
Agnes plans to file for bankruptcy under Chapter 7. One month prior to filing
Agnesgives Joe's Filling Station $700 to apply to her gasoline bill. Joe has been so kind to lether charge the gas she needed for her car over the past year. The bankruptcy trusteeappointed to the case:,d. can cancel the payment to Joe as a voidable preference.
Jerry believes his co-worker, Ben, is using illegal drugs. Since both he and Ben are nurses, Jerry is concerned Ben's drug usage could result in injury to a patient. He tells his supervisor, Cyndi. Cyndi talks with Jerry about the alleged drug usage and Ben produces a bottle of prescription medicine he is required to take for high blood pressure. The medication does not affect his ability to do his work. When Ben learns it was Jerry who reported him, Ben claims that Jerry committed an act of defamation when Jerry told Cyndi he used illegal drugs. Is Ben right?
No. Jerry is protected by the qualified privilege defense.
Susan and Brenda started a retail business called Eagle's Nest Hobbies. The business isoperated as a partnership. Under partnership law
Susan is personally liable for any:a. business contracts entered into by Brenda.b. business debts, regardless of whether she or Brenda created the obligation.c. negligent act committed by Brenda in the scope of the business activity. . All of the above
A partnership is not a separatetaxable entity
T
Arco sells to Melvin 1000 computers that are stored in Arco's warehouse Arco gives Melvin the ownership documents and Melvin will pick up the computers at the warehouse Title has passed to Melvin
T
Becoming a franchisee is a compromise between being an entrepreneur and being an employee
T
Brad was having financial difficulties and thought bankruptcy might be in his future. He transferred his sports car to his brother with the agreement that if he didn't file for bankruptcy within the next 18 months his brother would return the car to him. Brad did file for bankruptcy in ten months. The bankruptcy trustee can bring the car back to Brad's estate for the purpose of providing assets for Brad's creditors
T
Generally filing bankruptcy stops the collection activity of creditors
T
If the seller has made a substantial beginning in manufacturing custom-ordered goods then an oral contract may be enforceable regardless of the amount of money involved in the contract
T
Jamie purchased a compound bow from Tyler Jamie can prove he is a bona fide purchaser showing that he gave value and acted in good faith
T
Roger a minor buys some electronic equipment from Tuneland Inc. Roger uses the equipment for a few months returns it to Tuneland and demands his money back In a majority of states Roger may return the equipment and he does not have to pay for its use or the damages
T
The UCC imposes a duty of good faith in the performance of all contracts
T
The effects of a business decision on stakeholders are generally of more ethical concern rather than legal concern
T
The interstate commerce clause of the U.S. Constitution has been used to invalidate state regulations making it harder to purchase wines from out-of-state wine producers than from in-state wine producers
T
Vernon suffers from a mental impairment due to a brain injury from a motorcycle accident He contracts with Glena to purchase her dining room furniture A month later he tries to void the contract If he is unable to return the furniture a court will not rescindthe agreement unless Vernon can show that Glena acted in bad faith
T
Vicor Inc. holds a patent on a drug. Vicor used the patent to secure a $1 million loan from First Bank. The patent is a type of intangible property.
T
If an employee sues an employer claiming injury from assault and battery caused by another employee of the same employer, this is a criminal matter.
TRUE
Ethical companies:
Tend to earn higher returns than companies that engage in wrong-doing.b. Tend to have more creative employees than companies that engage in wrongdoing.d. Both a. and b.ANS: D
A gun manufacturer in Helena Montana agrees to sell guns and ammunition to the ATF n Washington D.C. The terms of the contract specify that the goods are to be shipped FOB hicago When does the buyer acquire title and risk of loss?
When the goods reach Chicago.
Which of the following exculpatory clauses has the most likely chance of being enforceable?
a. An exculpatory clause that relieves a riding stable of negligence.
Tony fell and injured himself in a Mega Toy Store. Mega Toy Store is incorporated in Delaware. Tony is a resident of Nevada but was injured in a Mega Toy Store located in Arizona. Mega Toy does not do business in Nevada. Tony's damages exceed $100000. If Tony decides to sue Mega Toy Store
a. He may file the lawsuit in an Arizona state court. b. He may file the lawsuit in a federal district court in Arizona. d. Either a or b. ANS: D
An insurance contract is not considered to be a legalized form of gambling because
a. One must have an insurable interest in the person being insured.
If Morales and Rolfes Supply negotiate for the purchase and sale of a supply of fuel for a three-year period for Morales' business
a. The contract may indicate a method for determining the price, without stating a definite price.
Assume that Bubba orders 15 cases of BBQ chips from Mays Potato Chips for his estaurant ubba's BBQ. Mays ships 15 cases of regular chips by mistake. If Bubba ecides to keep the regular chips n spite of the nonconformity with the contract then the estruction of the chips when a water pipe breaks in the food storage room will result in
c Bubba's having to bear the loss, because he accepted delivery of the
Which of the following contracts requires a writing under the UCC Article 2?
c. A toy manufacturer contracted to sell dolls valued at $10,000 to a department store.
Which of the following statements about the limited partnership is correct?
c. General partners are personally liable.
An S Corporation cannot have more than ____ shareholders.
d. 100
To simplify clarify and modernize the law governing commercial transactions the UCC permits the use of "open terms" in sales contracts. In the use of "open terms" which of the following is true?
d. All of the above are true.
The doctrine of preemption is based on the U.S. Constitution's:
d. Supremacy Clause
"Mens rea" means the "guilty mind", which one element of guilt which must be proved in every criminal case.
false
Congress passes a law, making it illegal to advertise the sale of wine online. If the U.S. Supreme Court decides the law is unconstitutional, prohibited by the U.S. Constitution, the likely basis for its decision is a violation of the Fifth Amendment to the Constitution.
false
Discovery is handled in the same way in arbitration and in litigation.
false
Even if a statute's words have ordinary, everyday significance, the court will look at the legislative history of the law and underlying public policy in order to interpret the statutes
false
Every criminal defendant has a right to a jury trial.
false
If you sue another person for hitting and damaging your car while you are in a national park (U.S. government property), this is an example of public law.
false
Most work of legislatures in passing new statutes is done by open debate in front of the entire legislature.
false
Personal emails are not subject to discovery in civil litigation.
false
Robert was a witness in a lawsuit. When asked why he fired Eva, Robert replied, "she was fired for stealing money from my office." Indeed, Eva had not stolen any money. Eva will be able to successfully sue Robert for defamation based on what he said in court.
false
The advantage of mediation is that the mediator has the power to make a binding decision.
false
The greatest motivator for ethical behavior is typically profitability.
false
Untrue political speech may be outlawed by Congress.
false
Tri a full-time college student sold his car to Don another student. In the performance of this contract Tri
has a duty of good faith which means honesty in fact.
Which entry is responsible for creating statutory law in the U.S.?
legislature
If a group of people intentionally disobeys certain laws targeting the deportation of foreigners from the country, on the basis that deportation violates human rights, the legal philosophy which is the basis for their actions is:
natural law
Ikerd was entering the United States from a trip abroad when the U.S. Customs and Border Protection confiscated some goods she had purchased and brought back with her. The process of reaching a determination of whether the government is attempting to take property and what type of hearing the U.S. Customs and Border Protection must offer Ikerd is an example of:
procedural due process
The doctrine of preemption is based on the Constitution's:
supremacy clause
Actual hearings are required in formal administrative agency role making.
true
An Internet service provider may not be held liable for defamation based on a posting made by internet users on its bulletin board.
true
If the legislature decides that the citizens of the country may not legally marry foreigners (non-citizens), obeying this law is an example of legal positivism.
true
In considering the effects of relocating a production facility to an offshore location, legal considerations must be handled before ethical issues.
true
Opinion is generally a valid defense in a defamation lawsuit because it cannot be proven to be true or false.
true
Professor Rifkin accused Helena, a senior at a large state university, of cheating on an final test. The Professor claimed that Helena had to prove to him that she did not cheat. She failed to convince him, she was expelled from college. Helena was denied her due process rights.
true
The defense of insanity, if successfully used in a criminal proceeding, will result in an acquittal of the crime(s) as charged.
true
The effects of a business decision on stakeholders are generally of more ethical concern, rather than legal concern.
true
The interstate commerce clause of the U.S. Constitution has been used to invalidate state regulations making it harder to purchase wines from out-of-state wine producers than from in-state wine producers.
true
"Mens rea" means the "guilty mind" which one element of guilt which must be proved in every criminal case
F
A bailment is a contractual arrangement in which the bailor or property owner temporarily transfers ownership of certain property to the bailee
F
A buyer in ordinary course of business takes the goods free of a security interest unless the security interest is perfected
F
A corporation's debts are discharged in a Chapter 7 bankruptcy proceeding
F
All unfair terminations are violations of public policy
F
Bankruptcy is regulated by both federal and state law
F
Crops are considered as identified goods when they are harvested
F
Even if a statute's words have ordinary everyday significance the court will look at the legislative history of the law and underlying public policy in order to interpret the statutes
F
Lily bought 150 shares of Orton Inc.'s stock. This contract is governed by Article 2 of the UCC
F
Regardless of the language of the contract title to goods passes to the buyer at the time and place at which the seller physically delivers the goods
F
The Bankruptcy Code uses the term "bankrupt" for a person who cannot pay his debts
F
The National Labor Relations Act includes the minimum wage laws
F
The UCC does not apply to contracts for the sale of goods if the value of the goods is less than $500
F
The UCC requires consideration for agreements modifying contracts for the sale of goods
F
The buyer and seller may not have an insurable interest in the same goods at the same time
F
Under the UCC the party who has title to the goods always has the exclusive risk of loss
F
An executive order may be issued by a court.
FALSE
Eduardo's Pizzas Inc. hired Bill to make home deliveries. During one delivery Bill found Martina home alone and attacked her. May Eduardo's Pizza be held liable?
a. Yes for negligent hiring, provided it failed to check Bill's references and criminal records and to contact his former employers to see if there had been any past problems with his behavior.
Microchip Computers is a retailer which buys its inventory from Acme Co. on credit giving Acme a security interest in the inventory. Hubert buys a computer from Microchip in the normal course of business. Hubert's title in the computer is
a. a good title.
Ruppart Manufacturing has a contract for the sale of 100 cases of teaching supplies to Teachers Co-op Inc. Payment of the order is to be made in installments over the next year. Ruppart Manufacturing keeps a security interest in the cases sold to assure payment by Teachers Co-op Inc. When the order is completed Ruppart ships the order. Legally
a. both Ruppart and Teachers have an insurable interest in the supplies.
Under the UCC statute of frauds the writing for a sale of goods must
a. state quantity.
A United States district court is
a. the primary federal trial court.
Assume that Dick steals Jane's camcorder and sells it to Sid. Jane can recover the camcorder from Sid
a. under any circumstances.
Which of the following ordinarily constitutes legal consideration?
b. A promise based upon exchange of duties.
Bernie's stereo has been damaged when his niece spilled some juice on it. He takes it to High Fidelity Co. to be fixed. Five days later when he returns to the store to pick it up he finds out that a clerk had sold it to a customer thinking it was part of their used items inventory. Which of the following is true?
b. If the third party buyer was a good faith purchaser, Bernie will not be able to get his stereo back as he entrusted his stereo to High Fidelity
Hensley and Boyer have been negotiating for several months over issues related to the purchase and sale of some real estate. They draft a letter of intent which
b. May or may not be an offer, depending on the exact language and whether the document indicates that the parties have reached an agreement.
For the creation of which of the following business organizations no formation papersneed to be filed?
b. Partnership
Tina wishes to learn what records the IRS has about her. Under the Freedom of Information Act (FOIA)
b. Tina is entitled to all information the IRS has about her.
Dean Builders agrees to purchase all of its sump pump requirements for the new houses it builds from Satisfactory Sump Pump Inc. These two businesses have had similar agreements the last three years and Dean's requirements have averaged 100 sump pumps per year. This year there was an unusually wet spring and Dean's requirements doubled to 200 sump pumps. Because of the high demand of sump pumps the market price of the pumps tripled. Satisfactory Sump Pump Inc. delivers 100 pumps at $75 eachthe contract price. Satisfactory has exhausted its inventory and cannot deliver any more so Dean buys the other 100 pumps from other suppliers at $225 each. Dean sues Satisfactory Sump Pump Inc. for the additional expense. What is the most likely result?
c. Satisfactory Sump Pump, Inc. wins requirements contracts are governed by a good faith standard and it was unreasonable for Dean to demand so many additional pumps.
In January Eddie contracts to sell 100 bushels of soybeans that fall. This contract
c. can be valid, but title to the soybeans cannot pass until the soybeans exist.
A security interest in money may be perfected by
c. possession only.
George's Grocery orders two dozen live lobsters from Sea Food Flyers. George's is to keep the lobsters happy by keeping them in a tank following certain instructions to keep the water at the right temperature etc. The sale is made on a trial basis and George's may return all unsold lobsters at the end of 10 days. This contract is
c. sale or return.
In the U.S. system of common law, the doctrine of stare decisis applies to
courts
