Question 1

Any natural person having full capacity may enter a partnership.

Accepted Answer

A) True 
 B)False  True

Question 2

The law establishes a test for determining whether a partnership has been formed.The test includes which of the following?

Accepted Answer

A)  An association of two or more persons. 
B)  Conducting a business not necessarily for profit. 
C)  That the partnership agreement is filed with the Secretary of State. 
D)  The sharing of gross returns. 
A)  An association of two or more persons. 
B)  Conducting a business not necessarily for profit. 
C)  That the partnership agreement is filed with the Secretary of State. 
D)  The sharing of gross returns. A

Question 3

Which of the following is correct with regard to partnership property?

Accepted Answer

A)  Like partnership capital, it is a fixed amount set forth in the articles of partnership. 
B)  Under the RUPA, there is a rebuttable presumption that unless a contrary intention appears, property acquired with partnership funds is partnership property. 
C)  The RUPA sets forth two irrebuttable presumptions that apply when the partners did not express their intent, one of which is that property acquired in the name of one of the partners without an indication of her capacity as a partner and without use of partnership funds is presumed to be that partner's separate property. 
D)  If there is no express agreement whether property owned by a partner before formation of the partnership and used in the partnership business is an asset of the partnership, the fact that taxes, liens, and expenses have been paid by the partnership is irrelevant. 
A)  Like partnership capital, it is a fixed amount set forth in the articles of partnership. 
B)  Under the RUPA, there is a rebuttable presumption that unless a contrary intention appears, property acquired with partnership funds is partnership property. 
C)  The RUPA sets forth two irrebuttable presumptions that apply when the partners did not express their intent, one of which is that property acquired in the name of one of the partners without an indication of her capacity as a partner and without use of partnership funds is presumed to be that partner's separate property. 
D)  If there is no express agreement whether property owned by a partner before formation of the partnership and used in the partnership business is an asset of the partnership, the fact that taxes, liens, and expenses have been paid by the partnership is irrelevant. B

Question 4

Under the RUPA, a partner is a co-owner of partnership property.

Accepted Answer

A) True 
 B)False

Question 5

Arthur, Betty, and Clara each inherit an undivided one-third interest in an apartment complex.Instead of selling it, they decide to continue to operate it for the next few years as a sideline to their other occupations just to see if they can earn some extra money.What are they?

Accepted Answer

A)  A partnership. 
B)  Co-owners only. 
C)  A corporation. 
D)  Creditors of the apartment complex. 
A)  A partnership. 
B)  Co-owners only. 
C)  A corporation. 
D)  Creditors of the apartment complex.

Question 6

Assume that you and your best friend have decided to form a partnership after graduation.You have both studied business law, so you both know the importance of having a written partnership agreement.Summarize the clauses that you would include in your partnership agreement.

Accepted Answer

The basic features of a partnership agre

Question 7

Marilyn, George, and Christine pool their money to buy land to operate a vegetable farm from which they plan to sell the produce and share the profits or losses.Are they partners?

Accepted Answer

A)  Yes, since they are associating to carry on a for-profit business which they co-own. 
B)  No, because they each control the use of the land. 
C)  Yes, because if there is a loss in the land's value, they will all share that loss. 
D)  No, they are merely joint venturers. 
A)  Yes, since they are associating to carry on a for-profit business which they co-own. 
B)  No, because they each control the use of the land. 
C)  Yes, because if there is a loss in the land's value, they will all share that loss. 
D)  No, they are merely joint venturers.

Question 8

A person who receives a share of profits of a business is presumed to be a partner.

Accepted Answer

A) True 
 B)False

Question 9

Whether an individual partner or the partnership owns certain property determines who gets it upon dissolution of the partnership and who shares in income from it.

Accepted Answer

A) True 
 B)False

Question 10

Rosella, a general partner of Jones and Thorne,  extends credit of $2,000 to a friend.This is  in violation of a specific agreement not to extend credit over $1,000 without the other partners' approval.Rosella will be held personally liable to the partners for any unpaid debt since she violated the duty of obedience.

Accepted Answer

A) True 
 B)False

Question 11

Miller and Baker formed a partnership and purchased a cycle shop.The name of the new business cannot be "Miller Cycle Shop" because the name of the partnership must include the names of both partners if it includes the name of one partner.

Accepted Answer

A) True 
 B)False

Question 12

No minimum amount of capitalization is necessary before a partnership may commence business.

Accepted Answer

A) True 
 B)False

Question 13

Partners may elect whether or not the partnership will be taxed as a separate entity.

Accepted Answer

A) True 
 B)False

Question 14

Under the RUPA, a partner violates the duty of loyalty if the conduct furthers the partner's own interest.

Accepted Answer

A) True 
 B)False

Question 15

A judicial lien against a partner's transferable interest in a partnership is known as:

Accepted Answer

A)  a legal aggregate. 
B)  a delegation of assets. 
C)  a charging order. 
D)  an assignment. 
A)  a legal aggregate. 
B)  a delegation of assets. 
C)  a charging order. 
D)  an assignment.

Question 16

A __________ is an unincorporated business association consisting of at least one general partner and at least one limited partner.

Accepted Answer

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

Question 17

Each partner, unless otherwise agreed, has equal rights in the management and conduct of the business of a general or a limited partnership.

Accepted Answer

A) True 
 B)False

Question 18

Alice and Brad enter into a partnership, which becomes insolvent, as does Brad.Alice is fully liable for the debts of the partnership.

Accepted Answer

A) True 
 B)False

Question 19

To be partnership property, title to real estate bought with partnership assets and used by the partnership may be put in the name of:

Accepted Answer

A)  any partner in that individual's name. 
B)  the partnership only. 
C)  the partnership in its name, or one or more partners in their capacity as partners in the partnership if the name of the partnership is indicated in the instrument transferring title. 
D)  the agent who represented the partnership in the transaction. 
A)  any partner in that individual's name. 
B)  the partnership only. 
C)  the partnership in its name, or one or more partners in their capacity as partners in the partnership if the name of the partnership is indicated in the instrument transferring title. 
D)  the agent who represented the partnership in the transaction.

Question 20

Afterburn Corporation and the Mangus Trust can be partners in a partnership if they carry on as co-owners a business for profit.

Accepted Answer

A) True 
 B)False

Exam 30: Formation and Internal Relations of General Partnerships

Any natural person having full capacity may enter a partnership.

The law establishes a test for determining whether a partnership has been formed.The test includes which of the following?

Which of the following is correct with regard to partnership property?

Under the RUPA, a partner is a co-owner of partnership property.

Arthur, Betty, and Clara each inherit an undivided one-third interest in an apartment complex.Instead of selling it, they decide to continue to operate it for the next few years as a sideline to their other occupations just to see if they can earn some extra money.What are they?

Assume that you and your best friend have decided to form a partnership after graduation.You have both studied business law, so you both know the importance of having a written partnership agreement.Summarize the clauses that you would include in your partnership agreement.

Marilyn, George, and Christine pool their money to buy land to operate a vegetable farm from which they plan to sell the produce and share the profits or losses.Are they partners?

A person who receives a share of profits of a business is presumed to be a partner.

Whether an individual partner or the partnership owns certain property determines who gets it upon dissolution of the partnership and who shares in income from it.

Miller and Baker formed a partnership and purchased a cycle shop.The name of the new business cannot be "Miller Cycle Shop" because the name of the partnership must include the names of both partners if it includes the name of one partner.

No minimum amount of capitalization is necessary before a partnership may commence business.

Partners may elect whether or not the partnership will be taxed as a separate entity.

Under the RUPA, a partner violates the duty of loyalty if the conduct furthers the partner's own interest.

A judicial lien against a partner's transferable interest in a partnership is known as:

A __________ is an unincorporated business association consisting of at least one general partner and at least one limited partner.

Each partner, unless otherwise agreed, has equal rights in the management and conduct of the business of a general or a limited partnership.

Alice and Brad enter into a partnership, which becomes insolvent, as does Brad.Alice is fully liable for the debts of the partnership.

To be partnership property, title to real estate bought with partnership assets and used by the partnership may be put in the name of:

Afterburn Corporation and the Mangus Trust can be partners in a partnership if they carry on as co-owners a business for profit.

Introduction to Law

Business Ethicspart Ii: the Legal Environment of Business

Civil Dispute Resolution

Constitutional Law

Administrative Law

Criminal Law

Negligence and Strict Liabilitypart Iii: Contracts

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 Remediespart Iv: Sales

Introduction to Sales and Leases

Performance

Transfer of Title and Risk of Loss

Product Liability: Warranties and Strict Liability

Sales Remediespart V: Negotiable Instruments

Form and Content

Transfer and Holder in Due Course

Liability of Parties

Bank Deposits, Collections, and Funds Transferspart Vi: Agency

Relationship of Principal and Agent

Relationship With Third Partiespart Vii: Business Associations

Operation and Dissolution of General Partnerships

Limited Partnerships and Limited Liability Companies

Nature and Formation of Corporations

Financial Structure of Corporations

Management Structure of Corporations

Fundamental Changes of Corporationspart Viii: Debtor and Creditor Relations

Secured Transactions and Suretyship

Bankruptcypart Ix: Regulation of Business

Securities Regulation

Intellectual Property

Employment Law

Antitrust

Accountants Legal Liability

Consumer Protection

International Business Lawpart X: Property

Introduction to Property, Property Insurance, Bailments, and Documents of Title

Interests in Real Property

Transfer and Control of Real Property

Trusts and Wills

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