Exam 2

Rangle contracts with Siena to buy a certain horse for her. Rangle makes a deal with Timberline Stables, the owner of the horse, and makes a down payment. Siena fails to pay for the rest of the price. Timeline sues Rangle for breach of contract. His right to hold Siena liable for any damages that he has to pay is the right of a.) indemnification b.) avoidance c.) cooperation d.) reimbursement

A

Detailed Designs Company, an architectural firm, wants to hire Eduardo, a noncitizen. A temporary work visa is most likely to be set aside for a noncitizen who is a.) a "person of extraordinary ability" b.) a "person of ethnic similarity to the employer's workforce" c.) a "person with an extraordinary work ethic" d.) a "person of ordinary ability and ambition

A

Dollars & Sense, Inc. is incorporated in the state of New Jersey and does business in the state of New York. In New York, Dollars & Sense is property referred to as: a.) a foreign corporation b.) a domestic corporation c.) an alien corporation d.) a public corporation

A

Fabulous Auto Sales, Inc., employs GR8 Collection Company as a collection agent. While repossessing a car from Hadji, one of Fabulous's customers, GR8 causes an accident in which Hadji is injured. Hadji can recover from a.) Fabulous or GR8 b.) Hadji's insurance company only c.) GR8 only d.) Fabulous only

A

First National Bank may subject its employees to lie-detector tests when investigating a.) losses attributable to theft b.) prior work history c.) health and medical conditions d.) suspected drug use

A

Hud and Iggy form Jerry-Bilt Construction to enter into a contract to build one bridge. Under their partnership agreement, Jerry-Bilt is to dissolve when the bridge is built. Iggy signs a contract for the firm to build a second bridge. Jerry-Bilt a.) dissolves as soon as the first bridge is build b.) dissolves as soon as the second bridge is built c.) dissolves immediately on Iggy's signing of the second contract d.) dose not dissolve

A

Jaclyn, an agent for Kilpatrick, enters into a contract on Kilpatrick's behalf with Leif that must be in writing to be enforceable under the Statue of Frauds. Under the equal dignity rule, Jaclyn's authority to enter into this contract a.) must be written b.) must be oral and written c.) may be oral or written d.) cannot be oral or written

A

Memphis Music Makers, Inc.'s stated purpose is to sell musical instruments. If CEO Neal contracts with Open Season Firearms in the corporation's name to sell a shotgun, he has likely committed: a.) an ultra vires act b.) a legal act c.) a de jure act d.) a de facto act

A

Miracle Motors employs Norris as a sales agent for a trial period. At the end of the period, Miracle Motors and Norris disagree on the amount of the commissions Norris is due for sales that he made. Norris may demand a.) an accounting b.) a constructive trust c.) specific performance d.) nothing

A

The shares of Home Mortgage Corporation are traded on the New York Stock Exchange. Home Mortgage Corporation is a.) a publicly held corporation b.) a nonprofit corporation c.) a close corporation d.) a public corporation

A

Ulnai indicates that she is acting as an agent on behalf of her unidentified client - Thoroughbred Stallions, LLC - when she entered into a contract with Shana. Liability to Shana for nonperformance of the contract may be imposed on a.) Ulani and Thoroughbred Stallions b.) Ulani only c.) neither Ulani nor Thoroughbred Stallions d.) Thoroughbred Stallions only

A

Bret buys a franchise from Comida Mexicano Ltd. If their agreement is like most franchise agreements, it will specify that Comida can terminate the franchise a.) for no reason b.) for cause only c.) for any reason d.) at will

B

Chuck works for Deepwater Drilling Corporation. While operating a Deepwater drill, Chuck suffers an injury. Under state workers' compensation laws, Chuck will be compensated only if a.) his injury was intentional b.) his injury was accidental c.) he is completely disabled d.) he does not have health insurance

B

Delicious Coffee company hires Elton to sell Delicious's products in a certain area. Delicious agrees to pay Elton a salary, plus commission, for a trial period. They also agree that Elton can sell using any methods and during any hours that seem appropriate. The key factor in whether Elton is Delicious's employee is a.) the amount of Elton's salary b.) the control Delicious has over the details of the work c.) the length of the trial period d.) the title that designates Elton's position

B

Frida hires Gert, a real estate broker, to act as her agent to sell her house. The house burns down before being sold. The agency agreement is likely a.) still in force if Frida gives Gert additional consideration b.) terminated by operation of law c.) still enforce if Gert does not tell prospective customers d.) terminated by mutual consent of the parties

B

In what type of business organization do some of the owners have limited liability, while other owners have unlimited personal liability a.) FLLP b.) LP c.) Partnership d.) LLP e.) None of the above

B

Jenna is fifteen years old. Under the Fair Labor Standards Act, Jenna cannot work a.) for her parents b.) in a hazardous occupation c.) in the delivery of newspapers d.) in the entertainment industry

B

Megan and Nicole do business as One World Realty. In acting on the firm's behalf in a deal with Property Acquisition Company, Megan fails to account for the profit. To her firm, Megan is a.) liable for breach of the duty of economic sense b.) liable for breach of the duty of loyalty c.) liable for breach of duty of care d.) not liable

B

Pilar is interested in buying a franchise from Quixotic Bike Corporation. Quixotic must disclose material facts that Pilar needs to make an informed decision concerning this purchase, according to a.) no law b.) the Federal Trade Commission's Franchise Rule c.) the Petroleum Marketing Practices Act of 1979 d.) the Uniform Commercial Code

B

Rodney is employed by Mike as a delivery truck driver. On one of his delivery routes, Rodney stops at convenience store to buy snacks. As Rodney is backing out of the convenience store he backs into a car driven by Sierra resulting in $50,000 in damages to Sierra's car. Which of the following is TRUE? a.) Mike is not liable for the damages because $50,000 is an unreasonable amount of damages for this type of accident b.) Mike is liable for the damage c.) Mike is not liable for the damages because the law does not impose vicarious liability on employers d.) Mike is not liable for the damages because the convenience store stop was outside the scope of Rodney's employment

B

What of the following best aligns with the doctrine of respondeat superior? a.) The doctrine is based on public policy that favors large employers b.) If an employee discovers dangerous conditions at his or her place of work, the employer will be held to have knowledge of said conditions c.) Employers are liable even during "frolics" taken by employees d.) Employers can be held legally liable for negligence by their employees while commuting to or from work

B

Commingling of personal and corporate funds is a primary reason a court may decide to: a.) Impose criminal liability on a corporation b.) Hold that a corporation by estoppel exists c.) Pierce the corporate veil d.) Conclude that an ultra vires violation has occurred e.) None of the above

C

Delicious Fruit-of-the-Month Company currently employed five hundred full-time workers and two hundred part-time seasonal workers. Because business has declined, Delicious plans to close a plant that employs more than fifty full-time workers. Advance notice of the layoff must be sent to a.) potential customers and suppliers b.) no one c.) affected workers or the union representative d.) all workers, even those who are not being laid off

C

Guy and Hanna do business as G-H Associates. If G-H is a partnership, it is governed by the Uniform Partnership Act a.) under all circumstances b.) only in the presence of an express agreement c.) in the absence of an express agreement d.) in the absence of an implied agreement

C

Hu, Ivan, and Juana apply to work for King Meatpacking Company. These individuals' identities and eligibility to work must be verified by a.) the individuals' countries of origin b.) the U.S. Citizenship and Immigration Services c.) the employer d.) the individual

C

Inger is a franchisee of Honey Bear Restaurants, LLC. Their contract gives Honey Bear the right to control virtually all aspects of Inger's operation, including the hiring of employees. One of the employees, Joris, commits a tort against Kiley, one of Inger's customers. Kiley files a suit against Honey Bear. Honey Bear is most likely a.) not liable because Inger is responsible for the employees b.) not liable because Kiley was Inger's customer c.) liable because Honey Bear exercises control over Inger's operations d.) liable because Kiley was Honey Bear's customer

C

Interstate Distribution, Inc. (IDI) provides its employees with an e-mail system. IDI notifies them that it will monitor their communications over the system. Some employees file a suit against IDI, claiming a violation of privacy. The court is most likely to hold that, with respect to communication over the e-mail system, a.) the employer violated the employees' privacy rights b.) federal law prohibits the employees' privacy claim c.) the employees did not have a reasonable expectation of privacy d.) federal law prohibits the employer's "intentional interception"

C

Lyon is an employee of Nero. Either party can terminate the employment relationship at any time for any reason without liability. With respect to the employment-at-will doctrine, this is a.) an exception based on tort theory b.) an exception based on public policy c.) an example of the doctrine d.) an exception based on contract theory

C

Security Armored Car Corporation employs Theo as an agent. Without Security's knowledge but otherwise acting within the scope of employment, Theo commits a crime. The state can successfully prosecute a.) Security or Theo b.) Security only c.) Theo only d.) neither Security nor Theo

C

Sela agrees to act on Thom's behalf, subject to Thom's control, and Thom trusts Sela to so act. They set out the terms in a written document, which they both sign. This is a.) not the creation of an agency relationship b.) an agency by estoppel c.) an agency by agreement d.) an agency by ratification

C

Tri-State Financial Corporation hires Uri, a real estate agent, to locate investment properties for Tri-state. Uri learns of a warehouse available for $100,000, informs Tri-state, and makes an offer of $90,000on Tri-state's instruction. The offer is rejected. Uri a.) made an unreasonable offer based on current market value b.) breached the agent's fiduciary duties to the principal c.) did nothing wrong d.) failed to take advantage of a business opportunity

C

Which of the following is FALSE under FMLA? a.) Remedies for violation include job reinstatement and damages for lost wages and benefits b.) Small businesses with under 50 employees are exempt from FMLA c.) Employers are not required to reinstate employees who take FMLA leave to their previous positions if they are within the top 15% of the firm's workforce d.) Twelve weeks of unpaid leave are available under the act to care for an adopted or foster child within one year of placement e.) all of the above

C

Which of the following would NOT qualify to be an S Corporation? a.) Company A which has 10 individual shareholders, one class of stock, and is a domestic corporation b.) Company B which has 90 individual shareholders all of whom are residents of Missouri and the company is incorporated in Missouri c.) Company C which has 2 shareholders, both partnerships organized under the laws of Missouri where the corporation is also incorporated d.) Company D which has 4 shareholders, 3 individuals, and 1 estate. This company has only one class of stock

C

A major disadvantage of the corporate business for is: a.) Shareholder-owner personal liability b.) Lack of flexibility in day-to-day operation c.) Inability to raise capital d.) Double taxation

D

Bob, a salesperson at a Carpets Galore store, tells Dita, a customer, "Buy your carpet here, and I'll install it for half of what the store would charge." Dita buys the carpet, which Bob installs for half of the store's price. Bob keeps the money. Bob has breached a.) no duty b.) the duty of obedience c.) the duty of notification d.) the duty of loyalty

D

Clive is a purchasing agent for Double D Ranch with the authority to buy cattle at a certain auction. After the cattle are bought, the agency relationship terminates a.) following notice to all actual cattle sellers b.) following published notice in a local newspaper c.) following notice to all potential cattle sellers d.) automatically

D

Clu, Dolf, and Elton do business as Fertile Valley Farm. Clu's relationship to the firm ends, but it continues to do business. This is a.) dissolution b.) wrongful c.) winding up d.) dissociation

D

Echo enters into an agreement with Deep Pan Pies, Inc., to operate a franchise in Centre City. Later, Deep grants franchises to others within the city. Echo files a suit to close them. If the court rules in Echo's favor it will most likely be on the ground that a.) Echo was the first Deep franchisee in Centre City b.) Deep violated the antitrust laws c.) Echo paid a franchise fee d.) Deep violated the implied covenant of good faith and fair dealing

D

Fern and Gray want to form a limited partnership to manage two restaurants: Cafe Latte and Deli Delight. In most states, a limited partnership will be created when a.) a partnership agreement is executed b.) the business for which the firm is formed actually opens its doors c.) the partners make their capital contributions d.) a certificate of limited partnership is filed

D

Genetic Seed Company hires Howie to work on Genetic's shipping dock, accepting deliveries and dealing with other companies' drivers. With respect to Genetic, Howie is most likely a.) an independent contract b.) a work for hire c.) a principal d.) an agent

D

Glen is an agent for Hi-Flite, Inc. On Hi-Flite's behalf and at its request, Glen pays Ian for certain plane maintenance and repair services. Glen's right to obtain the amount of those payments from Hi-Flite arises under the principal's duty of a.) cooperation b.) indemnification c.) avoidance d.) reimbursement

D

Jack and Kyra are partners in Law Firm, LLP, a limited liability partnership. Jack supervises Kyra, who negligently fails to appear in court on behalf of Milo, a client. Liability to Milo rests with a.) Kyra only. b.) Jack only. c.) neither Jack nor Kyra. d.) Jack and Kyra.

D

Jim organized, and owns and operates, Jim's Landscaping Service in the simples form of business organization. This is a.) a limited liability partnership b.) a partnership c.) a corporation d.) a sole proprietorship

D

Jody owns KuppaJava Kiosks, a sole proprietorship. Jody's liability is a.) limited by state statute and varies from state to state b.) limited to the extent of his or her original investment c.) limited to the extent of the capital expenditures d.) unlimited

D

Miklos grants an ordinary power of attorney to Nathalie to handle a list of financial transactions on Miklos's behalf. This power will terminate on a.) Nathalie's handling of one of each stipulated transaction b.) Miklos's sixty-fifth birthday c.) any transaction causing a loss to Miklos d.) Miklos's death or incapacity

D

Stacy contracts to buy a franchise from Tender Steak House Company. In this contract, as in most franchise contracts, the determination of the territory to be served is made by a.) a court b.) the Federal Trade Commission c.) Stacy d.) Tender Steak House

D

Ulani indicates that she is acting as an agent on behalf of her unidentified client - Thoroughbred Stallions, LLC - when she entered into a contract with Shana. Thoroughbred Stallions is a.) a non-existing principal b.) a disclosed principal c.) an undisclosed principal d.) a partially disclosed principal

D

Vasili is considering forms of business organizations for Vasili's Designs, an architectural firm. An advantage of a limited liability partnership is that partners may be able to avoid personal liability for a.) only partnership obligations that exceed capital contributions b.) only other partners' wrongdoing c.) only partnership obligations that fall within capital contributions d.) any partnership obligation

D

Which of the following is not most likely to be legally classified as an employee-employer relationship? a.) Carolyn worked on her own schedule for Joaquin for 5 years b.) Shireen worked for Max for just 2 months and supplied her own tools to perform the job. c.) Kim, a carpenter, worked for Tyler, an accountant and was paid every two weeks d.) Brice worked for Tony in an office setting and Tony scheduled Brice's entire day for him including Brice's lunch breaks

D

______________ must be filed with the proper state authority in order to create a corporation; __________ are passed at the corporation's first organizational meeting. a.) Bylaws; Articles of Incorporation b.) Articles of Organization; Bylaws c.) Bylaws; Articles of Organization d.) Articles of Incorporation; Bylaws e.) none of the above

D