Blaw Ch 25 & 26
T/F A corporation cannot acquire, hold, or convey property in its own name.
False
T/F The Equal Pay Act prohibits racial, cultural, and national origin discrimination in pay.
False
Which of the following is true regarding a sole proprietorship? It may be operated under an assumed or trade name. Employees of the business are not the personal employees of the owner. The salaries paid to the employees are not deductible in determining taxable income. The owner is personally immune from business-related tort and contract liability.
A A sole proprietorship is a business operated by a person as his own personal property. The person operating the business need not use his or her own name as the name of the business; it may be operated under an assumed or trade name. Such a trade name would have to be registered with the proper state or local official, however.
T/F A limited partnership permits investors who do not engage in management to share in the profits of the business without becoming personally liable for its debts.
True
T/F A partnership is a voluntary association designed to carry on a business for profit.
True
T/F A sole proprietorship is merely an extension of the individual owner.
True
T/F An employer's refusal to bargain collectively with a union that represents its employees is an example of an unfair labor practice under the Labor-Management Relations Act (LMRA).
True
A _____ provides the greatest ease of management. sole proprietorship general partnership close corporation limited partnership
A A sole proprietorship provides the greatest ease of management. There, the proprietor is free, within the limits of the law, to unilaterally determine the destiny of the organization.
The Family and Medical Leave Act (FMLA) _____. provides job security to employees with serious health conditions covers the birth, but not the adoption of, a child requires employers with thirty (30) or more employees to give covered employees up to eighteen (18) paid workweeks of leave per year to deal with their personal health problemss covers employees the moment they begin work
A The Family and Medical Leave Act (FMLA), passed in 1993, is designed to provide job security to employees with serious health conditions as well as to provide reasonable leave periods for family-related health issues. Another important goal is to make the workplace more accommodating to women and families.
A freeze-out _____. occurs when a majority shareholder is prohibited by management from being involved in the business decision-making process regarding such issues as a reduction or elimination of dividends results in the minority shareholder having little influence in important corporate issues such as a loss of employment occurs mostly in S corporations can be easily reversed in court
B A minority shareholder in a close corporation has little power and, thus, may be frozen out (left out of important opportunities) by the majority regarding such issues as a reduction or elimination of dividends as well as a loss of employment.
Mandatory employment arbitration agreements _____. are supported by the Equal Employment Opportunity Commission (EEOC) do not apply to claims of discrimination keep employees from suing about workplace disputes are disfavored by the United States Supreme Court
C A trend among employers is to have employees sign mandatory arbitration agreements as a condition of getting or keeping a job. These agreements keep employees from suing about any workplace dispute, including discrimination claims. The Equal Employment Opportunity Commission, which strongly supports ADR (alternative dispute resolution), objects to mandatory binding arbitration as a condition of employment.
The Fair Labor Standards Act (FLSA) requires covered employers to _____. pay their employees double time be involved in hiring and firing decisions pay their employees a minimum hourly wage pay their professional staff time and a half for hours worked in excess of forty-five (45) in one week
C In 1938, the United States Congress passed the Fair Labor Standards Act (FLSA), which requires covered employers to pay their employees a minimum hourly wage and to pay time and a half for hours worked in excess of 40 in one week. Generally, employers are covered if they are engaged in interstate commerce or if their annual gross sales exceed $500,000 and their business affects interstate commerce.
William and Nigel decide to form a partnership for their business. They ask their friend Sophia to become a limited partner in order to help them with additional funds to get the business started. Which of the following regarding Sophia is correct if she becomes a limited partner in this scenario? She may assist in the management of the business without losing her limited partnership protection. She cannot share in the profits of the business. She may lose her investment if the business fails, but she will have no personal liability for partnership debts. She will be entitled to a salary for the services she renders to the partnership.
C In this scenario, Sophia may lose her investment if the business fails, but she will have no personal liability for partnership debts. Limited partners who do not participate in management and shareholders in a corporation may lose their investment if the business fails. However, they have no further liability to creditors of the business or to victims of torts that are attributable to the business.
The Occupational Safety and Health Act (OSHA) imposes on employers a general duty to _____. develop and enforce their own health and safety programs make the workplace more accommodating to women and families prevent workplace hazards that may cause death or serious injury provide reasonable leave periods for family-related health issues
C The Occupational Safety and Health Act of 1970 (OSHA) imposes on employers a general duty to prevent workplace hazards that may cause death or serious physical harm. In addition, employers are required to report on-the-job fatalities and injuries that require hospitalization to the Secretary of Labor within forty-eight (48) hours. Employers with more than ten (10) employees are required to keep a log of all work-related deaths, injuries, and illnesses.
A turnkey operation can be best described as a _____. franchise operated by a person as his or her own personal property franchise in which the franchisee assumes exclusive responsibility for business-related promotion and advertising limited liability partnership with a high rate of ownership turnover franchise in which the franchisor builds and equips the place of business and leases it to the franchisee
D From a franchisee's standpoint, especially if he or she has had little or no experience in the business being franchised, the most important services of the franchisor are likely to be advertising, training in the business, and advice after the business is under way. Some franchisors also assist with financing. They may build and equip the place of business and lease it to the franchisee—a so-called turnkey operation.
Acts that have a discriminatory effect are referred to as _____. quid pro quo disparate treatment hostile work environment disparate impact
D According to the Equal Employment Opportunity Commission (EEOC) and the courts, Title VII of the Civil Rights Act prohibits acts that have a discriminatory effect, also referred to as disparate impact.
When it comes to tax liability, limited liability companies (LLCs) _____. are taxed as traditional corporations are required in every state to file annual reports with the secretary of state do not require partners to report their share of the LLC's profits on personal tax returns are taxed as partnerships
D All fifty (50) states have statutes that permit businesses to operate as limited liability companies (LLCs). These statutes grant LLCs the taxation benefits of partnerships and the limited liability advantages of corporations.
When a general partner sells his or her partnership interests, the purchaser _____. is granted partnership only after he divests all interests in other general partnerships does not become a partner until he or she is nominated by the director and unanimously accepted by the other shareholders is granted automatic partnership by operation of law does not become a partner until he or she is unanimously accepted by the other general partners
D General partners can sell their partnership interests, but the purchaser does not become a partner unless he or she is accepted unanimously by the other general partners into what is essentially a new partnership.
The major legislation outlawing employment discrimination, specifically prohibiting discrimination on the basis of race, color, religion, sex, or national origin is _____. the Fair Labor Standards Act (FLSA) the Equal Pay Act the Age Discrimination in Employment Act (ADEA) Title VII of the Civil Rights Act
D The major legislation outlawing discrimination in employment is Title VII of the Civil Rights Act of 1964 (as amended in 1972). It prohibits discrimination on the basis of race, color, religion, sex, or national origin. Covered employers cannot use any of these human differences to make distinctions for purposes of hiring, firing, promoting, or fixing pay rates or other terms and conditions of employment.
T/F A secretary whose husband comes to her office and assaults her at work would be able to recover under workers' compensation for any resulting injuries because they occurred during work hours and on company property.
False
T/F According to the Family and Medical Leave Act (FMLA), employers with fifty (50) or more employees are required to give covered employees up to twelve (12) paid workweeks of leave per year to deal with the care of themselves, a child, a spouse, or a parent with a serious health condition.
False
T/F By forming a limited liability partnership (LLP), the personal assets of partners not involved in wrongdoing by other members of the firm will be sheltered from malpractice claims against the firm.
True
T/F In a general partnership, each partner is an owner and has a right to share in the profits of the business.
True
T/F Most franchise contracts are typical contracts of adhesion.
True
Which of the following is required for an S corporation to be taxed as a partnership? Its shareholders must all be corporate executives or board members of the S corporation. There can be no more than eighty (80) shareholders in the S corporation. Its losses and earnings must not be reported on the shareholders' individual tax returns. Its shareholders must consent in writing to having the corporation taxed as a partnership.
D Several requirements must be maintained or the Subchapter S corporation loses its tax status. One of them is that shareholders must consent in writing to having the corporation taxed as a partnership.
Which of the following is true regarding franchising? It is immune from the application of federal, but not state, administrative agency law. A franchise can be operated as a sole proprietorship or a corporation, but not as a partnership. It is not contractual. It typically involves a corporation as a franchisor.
D The franchising relationship is contractual. The franchisor may conduct its business as a sole proprietorship, partnership, or corporation and so may the franchisee. Typically, the franchisor is a corporation, and often the franchisee forms a corporation to own and operate the franchised business.
T/F Anyone who buys the interest of a limited liability partnership (LLP) partner is not a partner unless the other partners unanimously agree.
True
The Employment Retirement Income Security Act of 1974 (ERISA) _____. primarily regulates the management and vesting of established pension plans primarily requires employers to establish pension plans covers union-sponsored pension plans, not employer-sponsored pension plans empowers an aggrieved party to bring an unfair labor practice charge against a union or an employer
A Almost half the civilian workforce is covered by pension plans. Before the passage of the Employment Retirement Income Security Act (ERISA) in 1974, abuses and injustices under these plans were common. ERISA primarily regulates the management and vesting of established pension plans
In terms of labor law, garnishment _____. is a court order that makes money or property held by a debtor subject to the claim of a creditor occurs when an employer discontinues production and operations during a labor dispute is an unfair practice charge brought against a union or an employer refers to a plan for increasing the proportion of minorities or women in an employer's workforce
A Most states have statutes dealing with the garnishment of wages. Garnishment is a court order that makes money or property held by a debtor (the garnishee) subject to the claim of a creditor. The statutes usually limit the amount of wages subject to garnishment.
The formation of a general partnership requires _____. filing articles of partnership with the secretary of state in the state where the partnership has its essential business operations no express agreement that each partner be liable for losses depending on the individual partner's contribution to the business a formal certificate of cancellation when the partnership is terminated
B A partnership is a voluntary association designed to carry on a business for profit. However, no express agreement to create a general partnership is necessary. All that is required is that the parties intend to have the relationship the law defines as a partnership.
The Equal Pay Act of 1963 was passed as an amendment to _____. the National Labor Relations Act (NLRA) the Fair Labor Standards Act (FLSA) the Labor-Management Relations Act (LMRA) Title VII of the Civil Rights Act
B The Equal Pay Act of 1963 was passed as an amendment to the Fair Labor Standards Act (FLSA). It prohibits sex discrimination in pay. It requires covered employers to pay employees of both sexes equally for jobs that require equal skill, effort, and responsibility, and that are performed under similar working conditions.
Quid pro quo harassment involves _____. an employee being subjected to demeaning and inappropriate conduct based on her religious orientation some express or implied connection between the employee's submission to sexually oriented behavior and job benefits demeaning, offensive, and inappropriate conduct against an employee based on race the creation of a hostile work environment through the use and/or dissemination of sexually inappropriate words, jokes, or materials, with the offender knowing or having reason to know that such practices would be offensive to a reasonable person
B Title VII of the Civil Rights Act of 1964 has more recently been interpreted to encompass sexual harassment as a form of prohibited discrimination. The first kind of sexual harassment to be prohibited, quid pro quo harassment, involves some express or implied connection between the employee's submission to sexually oriented behavior and job benefits. The other kind of sexual harassment is conduct that creates a hostile work environment.
Which of the following is true regarding the Equal Pay Act? The Equal Pay Act was passed as an amendment to the Equal Employment Opportunity Act (EEOA), prohibiting sex discrimination in pay. It is designed to prevent problems such as the underfunding and careless management of pension funds. It requires that both sexes have equal pay for jobs that require equal responsibility and that are performed under similar working conditions. Equal rates of pay are permitted under seniority and merit systems, as well as other incentive-based systems.
C The Equal Pay Act, passed as an amendment to the Fair Labor Standards Act (FLSA), prohibits sex discrimination in pay. It requires covered employers to pay employees of both sexes equally for jobs that require equal skill, effort, and responsibility, and that are performed under similar working conditions.
Which of the following is a taxable entity? A general partnership An S corporation A corporation A sole proprietorship
C A corporation is a taxable entity. On the other hand, a partnership and a sole proprietorship are not treated as taxable entities. S corporations are also taxed very much like a partnership in that no corporate tax is paid.
A _____ limits the personal liability of its shareholders. sole proprietorship limited partnership corporation general partnership
C A corporation is treated as an entity separate and distinct from its owners. The principal reason to incorporate a business today, however, is the limited liability of its shareholders. Ordinarily, the owners (shareholders) of a corporation are not personally liable for its debts; their loss is limited to their investment.
Which of the following is true regarding the Americans with Disabilities Act (ADA)? It applies to employers with ten (10) or more employees that engage in an industry affecting intrastate commerce. "Reasonable accommodation" under the ADA includes providing quality treatment for drug and alcohol addiction. It protects a qualified individual with a disability from discrimination on the basis of that disability. It does not protect people with AIDS or AIDS-related conditions.
C The enactment of the Americans with Disabilities Act of 1990 (ADA) extended comprehensive federal coverage against discrimination on the basis of disability.
T/F The Americans with Disability Act (ADA) covers physical, but not mental, impairments that substantially limit one or more of a person's major life activities.
False
T/F The Employment Retirement Income Security Act (ERISA) requires employers to establish pension plans and to meet specific benefit levels.
False
T/F The Equal Employment Opportunity Commission (EEOC) has interpreted Title VII of the Civil Rights Act of 1964 to include intentional acts of discrimination, but not acts that merely have discriminatory impact.
False
T/F The Occupational Safety and Health Act of 1970 (OSHA) requires covered employers to pay their employees a minimum hourly wage and to pay time and a half for hours worked in excess of forty (40) in one week.
False
