Question 1

The certificate of a limited partnership must be amended if a new general partner is admitted.

Accepted Answer

A) True 
 B)False  True

Question 2

LLC statutes all require the articles of organization:

Accepted Answer

A)  to include whether the LLC will be managed by managers who may, but need not be, members. 
B)  to be in writing and filed with the state. 
C)  to include in the name of the business the designation "limited liability company" or "LLC." 
D)  to include the name of the firm and the address of the principal place of business or registered office. 
A)  to include whether the LLC will be managed by managers who may, but need not be, members. 
B)  to be in writing and filed with the state. 
C)  to include in the name of the business the designation "limited liability company" or "LLC." 
D)  to include the name of the firm and the address of the principal place of business or registered office. D

Question 3

If Jack contributed $1000 as a limited partner, signed a certificate, but the certificate was filed in the wrong office, Jack:

Accepted Answer

A)  will not be liable as a general partner if he quickly withdraws from the business and renounces future profits. 
B)  is not a partner at all and may withdraw his contribution. 
C)  cannot avoid liability as a general partner under any circumstances. 
D)  may become a limited partner by giving constructive notice of the defective filing to all potential business contacts by an advertisement in a publication of general circulation. 
A)  will not be liable as a general partner if he quickly withdraws from the business and renounces future profits. 
B)  is not a partner at all and may withdraw his contribution. 
C)  cannot avoid liability as a general partner under any circumstances. 
D)  may become a limited partner by giving constructive notice of the defective filing to all potential business contacts by an advertisement in a publication of general circulation. A

Question 4

Daniel is a general partner in a real estate investment firm. Hank and Barry are limited partners. Daniel, without the consent or ratification of Hank and Barry, can:

Accepted Answer

A)  admit another limited partner. 
B)  act as an agent of the partnership. 
C)  rename the partnership using Hank's last name. 
D)  not have almost exclusive managerial control of the business. 
A)  admit another limited partner. 
B)  act as an agent of the partnership. 
C)  rename the partnership using Hank's last name. 
D)  not have almost exclusive managerial control of the business.

Question 5

If a limited partner votes on an amendment to the partnership agreement allowing a new business venture, he will not lose his limited status.

Accepted Answer

A) True 
 B)False

Question 6

Joe Stewart is a limited partner in a limited partnership. Joe does not have the right to dissolve the partnership except by decree of a court.

Accepted Answer

A) True 
 B)False

Question 7

The majority of states have adopted the 2001 revision of the Revised Uniform Limited Partnership Act (ReRULPA), which reflects that LLPs and LLCs can meet many of the needs formerly met by limited partnerships.

Accepted Answer

A) True 
 B)False

Question 8

If the written partnership agreement makes no provision for sharing profits and losses in a limited partnership, they are shared equally.

Accepted Answer

A) True 
 B)False

Question 9

A for-profit company with a socially beneficial purpose as its primary objective is called a  low-profit limited liability company (L3C).

Accepted Answer

A) True 
 B)False

Question 10

The RULPA requires that the limited partnership certificate list the capital contribution of each general and limited partner.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is NOT true about a limited liability company?

Accepted Answer

A)  It is a noncorporate business organization. 
B)  In most states, an LLC must have at least two members. 
C)  It may elect not to be a separate taxable entity. 
D)  An ownership interest may be considered a security. 
A)  It is a noncorporate business organization. 
B)  In most states, an LLC must have at least two members. 
C)  It may elect not to be a separate taxable entity. 
D)  An ownership interest may be considered a security.

Question 12

Members of an LLC share profits and losses equally.

Accepted Answer

A) True 
 B)False

Question 13

Legislation authorizing the formation of  low-profit limited liability companies  (L3Cs) has been enacted in only four states, as of 2017.

Accepted Answer

A) True 
 B)False

Question 14

Lonny is a partner in the Harris Limited Partnership. Unless the partnership agreement provides otherwise, Lonny may:

Accepted Answer

A)  assign his partnership interest and, if he does, he ceases to be a partner. 
B)  assign his partnership interest, but if he does, the assignment dissolves the partnership. 
C)  assign his partnership interest and, if he does, the assignee may exercise the rights of a partner. 
D)  not assign his partnership interest. 
A)  assign his partnership interest and, if he does, he ceases to be a partner. 
B)  assign his partnership interest, but if he does, the assignment dissolves the partnership. 
C)  assign his partnership interest and, if he does, the assignee may exercise the rights of a partner. 
D)  not assign his partnership interest.

Question 15

Which of the following is correct regarding the fiduciary duties in a limited partnership?

Accepted Answer

A)  The general partner has a fiduciary relationship to the limited partners, but not to any other general partners. 
B)  Judicial authority seems to suggest that the limited partner has no fiduciary duty to the partnership. 
C)  The fiduciary duty of the general partner has little effect upon the interests of the limited partners, because they have no ability to manage or control the partnership. 
D)  All of these are correct. 
A)  The general partner has a fiduciary relationship to the limited partners, but not to any other general partners. 
B)  Judicial authority seems to suggest that the limited partner has no fiduciary duty to the partnership. 
C)  The fiduciary duty of the general partner has little effect upon the interests of the limited partners, because they have no ability to manage or control the partnership. 
D)  All of these are correct.

Question 16

An operating agreement is adopted by members of a limited liability company.

Accepted Answer

A) True 
 B)False

Question 17

Written consent of all partners is required for the addition of a general partner if the partnership agreement so provides or if the partnership agreement fails to deal with this issue.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following is correct regarding a limited partnership?

Accepted Answer

A)  The general partner must make a cash or property contribution. 
B)  It can be created in such a way that the general partner has limited liability. 
C)  It can only be created pursuant to statutory provisions. 
D)  Limited partners are unable to vote on the incurrence of debt other than in the ordinary course of business under the safe harbor provisions of the RULPA. 
A)  The general partner must make a cash or property contribution. 
B)  It can be created in such a way that the general partner has limited liability. 
C)  It can only be created pursuant to statutory provisions. 
D)  Limited partners are unable to vote on the incurrence of debt other than in the ordinary course of business under the safe harbor provisions of the RULPA.

Question 19

What are the liabilities of a limited partner in a limited partnership?

Accepted Answer

Limited partners are liable only to the

Question 20

False statements in a limited partnership's certificate or amendment that cause loss to third parties who rely on the statement may result in liability for the general partners.

Accepted Answer

A) True 
 B)False

Exam 32: Limited Partnerships and Limited Liability Companies

The certificate of a limited partnership must be amended if a new general partner is admitted.

LLC statutes all require the articles of organization:

If Jack contributed $1000 as a limited partner, signed a certificate, but the certificate was filed in the wrong office, Jack:

Daniel is a general partner in a real estate investment firm. Hank and Barry are limited partners. Daniel, without the consent or ratification of Hank and Barry, can:

If a limited partner votes on an amendment to the partnership agreement allowing a new business venture, he will not lose his limited status.

Joe Stewart is a limited partner in a limited partnership. Joe does not have the right to dissolve the partnership except by decree of a court.

The majority of states have adopted the 2001 revision of the Revised Uniform Limited Partnership Act (ReRULPA), which reflects that LLPs and LLCs can meet many of the needs formerly met by limited partnerships.

If the written partnership agreement makes no provision for sharing profits and losses in a limited partnership, they are shared equally.

A for-profit company with a socially beneficial purpose as its primary objective is called a low-profit limited liability company (L3C).

The RULPA requires that the limited partnership certificate list the capital contribution of each general and limited partner.

Which of the following is NOT true about a limited liability company?

Members of an LLC share profits and losses equally.

Legislation authorizing the formation of low-profit limited liability companies (L3Cs) has been enacted in only four states, as of 2017.

Lonny is a partner in the Harris Limited Partnership. Unless the partnership agreement provides otherwise, Lonny may:

Which of the following is correct regarding the fiduciary duties in a limited partnership?

An operating agreement is adopted by members of a limited liability company.

Written consent of all partners is required for the addition of a general partner if the partnership agreement so provides or if the partnership agreement fails to deal with this issue.

Which of the following is correct regarding a limited partnership?

What are the liabilities of a limited partner in a limited partnership?

False statements in a limited partnership's certificate or amendment that cause loss to third parties who rely on the statement may result in liability for the general partners.

Introduction to Law

Business Ethics

Civil Dispute Resolution

Constitutional Law

Administrative Law

Criminal Law

Intentional Torts

Negligence and Strict Liability

Introduction to Contracts

Mutual Assent

Conduct Invalidating Assent

Consideration

Illegal Bargains

Contractual Capacity

Contracts in Writing

Third Parties to Contracts

Performance Breach and Discharge

Contract Remedies

Introduction to Sales and Leases

Performance

Transfer of Title and Risk of Loss

Product Liability Warranties and Strict Liability

Sales Remedies

Form and Content

Transfer and Holder in Due Course

Liability of Parties

Bank Deposits Collections and Funds Transfers

Relationship of Principal and Agent

Relationship With Third Parties

Formation and Internal Relations of General Partnerships

Operation and Dissolution of General Partnerships

Nature and Formation of Corporations

Financial Structure of Corporations

Management Structure of Corporations

Fundamental Changes of Corporations

Secured Transactions and Suretyship

Bankruptcy

Securities Regulation

Intellectual Property

Employment Law

Antitrust

Accountants Legal Liability

Consumer Protection

Environmental Law

International Business Law

Introduction to Property Property Insurance Bailments and Documents of Title

Interests in Real Property

Transfer and Control of Real Property

Trusts and Wills

Filters