Question 1

A dormant partner is usually known to the public as a partner.

Accepted Answer

A) True 
 B)False  False

Question 2

Which of the following is true of limited liability companies?

Accepted Answer

A) An LLC can be sued by third-parties as a separate entity. 
B) An LLC cannot enter into contracts under its own name. 
C) An LLC is a legal entity indistinct from its members. 
D) An LLC cannot be a manager-managed business entity. 
A) An LLC can be sued by third-parties as a separate entity. 
B) An LLC cannot enter into contracts under its own name. 
C) An LLC is a legal entity indistinct from its members. 
D) An LLC cannot be a manager-managed business entity. A

Question 3

An LLC can be dissolved with the written consent of all members.

Accepted Answer

A) True 
 B)False  True

Question 4

A partnership is one engaged in buying and selling merchandise.

Accepted Answer

A) trading 
B) limited 
C) nontrading 
D) nominal 
A) trading 
B) limited 
C) nontrading 
D) nominal

Question 5

A general partner has limited liability with respect to the partnership debts.

Accepted Answer

A) True 
 B)False

Question 6

What are the important features of a limited liability company? Explain. ​

Accepted Answer

There are two important features of an L

Question 7

A sole proprietor has ultimate responsibility for all business decisions. ​

Accepted Answer

A) True 
 B)False

Question 8

Which of the following best describes sole proprietorship? ​

Accepted Answer

A) It is a business owned by two people with limited liability. 
B) It is a business owned by two people and operated by one. 
C) It is a business owned by one person with limited liability. 
D) It is a business owned and carried on by one person. 
A) It is a business owned by two people with limited liability. 
B) It is a business owned by two people and operated by one. 
C) It is a business owned by one person with limited liability. 
D) It is a business owned and carried on by one person.

Question 9

The owners or investors of a limited liability company are called members.

Accepted Answer

A) True 
 B)False

Question 10

The partners in a nontrading partnership have the same apparent authority as partners in a trading partnership.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is true of a sole proprietorship?

Accepted Answer

A) A sole proprietor has limited flexibility in managing the business. 
B) A sole proprietor has unlimited liability and high financial risk. 
C) A sole proprietorship operated under the proprietor's name must be registered. 
D) A sole proprietorship is a complex business to organize. 
A) A sole proprietor has limited flexibility in managing the business. 
B) A sole proprietor has unlimited liability and high financial risk. 
C) A sole proprietorship operated under the proprietor's name must be registered. 
D) A sole proprietorship is a complex business to organize.

Question 12

Zen Corp, an Australian company, and Pluto Inc, an American company, entered into a one-time contract to build an elevated expressway in Florida. The contract was for a period of five years and both companies were equally liable under their agreement. This type of business enterprise is known as a .

Accepted Answer

A) joint-stock company 
B) limited liability company 
C) partnership 
D) joint venture 
A) joint-stock company 
B) limited liability company 
C) partnership 
D) joint venture

Question 13

The default tax classification of a limited liability company having two or more members, is that of a sole proprietorship.

Accepted Answer

A) True 
 B)False

Question 14

A sole proprietor has very limited flexibility in managing the business.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following is true of silent partners?

Accepted Answer

A) They are not required to invest capital in the business. 
B) They take no part in the management of the business. 
C) They are responsible for the day to day upkeep of the business. 
D) They take the same risk of losses as the other partners. 
A) They are not required to invest capital in the business. 
B) They take no part in the management of the business. 
C) They are responsible for the day to day upkeep of the business. 
D) They take the same risk of losses as the other partners.

Question 16

An individual who is not a partner but is held out as a partner is a partner.

Accepted Answer

A) limited 
B) secret 
C) nominal 
D) dormant 
A) limited 
B) secret 
C) nominal 
D) dormant

Question 17

Unlimited personal liability of each general partner for partnership debts is a disadvantage of the partnership form of business.

Accepted Answer

A) True 
 B)False

Question 18

An individual need only begin doing business to start a sole proprietorship.

Accepted Answer

A) True 
 B)False

Question 19

All partners of a limited partnership have limited liability.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is true of limited liability partnerships?

Accepted Answer

A) This type of partnership can operate under the Uniform Partnership Act. 
B) This type of partnership can be formed without a specific state statute prescribing the conditions under which it can operate. 
C) This type of partnership cannot operate under the common law. 
D) This type of partnership cannot be formed in most states. 
A) This type of partnership can operate under the Uniform Partnership Act. 
B) This type of partnership can be formed without a specific state statute prescribing the conditions under which it can operate. 
C) This type of partnership cannot operate under the common law. 
D) This type of partnership cannot be formed in most states.

Exam 29: Introduction to Business Organizations

A dormant partner is usually known to the public as a partner.

Which of the following is true of limited liability companies?

An LLC can be dissolved with the written consent of all members.

A partnership is one engaged in buying and selling merchandise.

A general partner has limited liability with respect to the partnership debts.

What are the important features of a limited liability company? Explain. ​

A sole proprietor has ultimate responsibility for all business decisions. ​

Which of the following best describes sole proprietorship? ​

The owners or investors of a limited liability company are called members.

The partners in a nontrading partnership have the same apparent authority as partners in a trading partnership.

Which of the following is true of a sole proprietorship?

The default tax classification of a limited liability company having two or more members, is that of a sole proprietorship.

A sole proprietor has very limited flexibility in managing the business.

Which of the following is true of silent partners?

An individual who is not a partner but is held out as a partner is a partner.

Unlimited personal liability of each general partner for partnership debts is a disadvantage of the partnership form of business.

An individual need only begin doing business to start a sole proprietorship.

All partners of a limited partnership have limited liability.

Which of the following is true of limited liability partnerships?

Introduction to Law

Courts and Court Procedures

Business Torts and Crimes

Government Regulation of Business

Nature and Classes of Contracts

Offer and Acceptance

Capacity to Contract

Consideration

Defective Agreements

Illegal Agreements

Written Contracts

Third Parties and Contracts

Termination of Contracts

Nature of Personal Property

Special Bailments

Sales of Personal Property

Formalities of a Sale

Transfer of Title and Risk in Sales Contracts

Warranties Product Liability and Consumer Protection

Nature of Negotiable Instruments

Essentials of Negotiability

Promissory Notes and Drafts

Negotiation and Discharge

Liabilities of Parties, Holders in Due Course and Defenses

Nature and Creation of an Agency

Operation and Termination of an Agency

Employer and Employee Relations

Employees Rights

Creation and Operation of a Partnership

Dissolution of a Partnership

Nature of a Corporation

Ownership of a Corporation

Management and Dissolution of a Corporation

Principles of Insurance

Types of Insurance

Security Devices

Bankruptcy

Nature of Real Property

Transfer of Real Property

Real Estate Mortgages

Landlord and Tenant

Wills Inheritances and Trust

Filters

What are the important features of a limited liability company? Explain.

A sole proprietor has ultimate responsibility for all business decisions.

Which of the following best describes sole proprietorship?