Exam 27: All Forms of Partnership

Sweet Selections, a general partnership, operates as a gift shop. Sweet Selections has ten partners. Jill and Amy each have a 25 percent interest in the partnership. All the other members have a 10 percent interest. With respect to management decisions

A third party can sue one of the partners of a partnership without suing all members of the partnership.

Unlike most agents, each partner in a partnership has an ownership interest in the business.

Nell is considering forms of business organization for Optic Center, a medical eye clinic. An advantage of a limited liability partnership is that, depending on the applicable state statute, partners can avoid personal liability for​

Blythe and Cali do business as Diamond Investments. In acting on the firm's behalf, Blythe makes an honest error in overestimating the value of a particular stock purchase. To her firm, Blythe is

Fact Pattern 27-2 Kristin and Lindsey are partners in Mobile Devise, an online marketing firm. -Refer to Fact Pattern 27-2. Kristin signs a contract with Nature's Best Chocolate, a candy maker and seller, apparently on Mobile's behalf. The contract is binding on​

Fact Pattern 27-3 ​Bryn, Cornell, and Duke are general partners in Equity Lending, a consumer credit, mortgage, and investment firm. Their agreement states that it is a breach of the agreement for any partner to assign his or her interest to a creditor without the consent of the other partners. -Refer to Fact Pattern 27-3. The partners decide to dissolve Equity Lending. Duke collects and distributes the firm's assets. This results in

The death of a limited partner dissolves a limited partnership.

On dissolution, the creditors of the partnership, but not the creditors of the individual partners, can make claims on the partnership's assets.

A limited liability partnership must be formed in compliance with state statutes.

Rosalee is a partner in Silver Dragon, a partnership consisting of the owners of a Chinese and American restaurant. Silver Dragon incurs debt for new dining tables and chairs. With respect to this debt, Rosalee is​

A partner always has the power but he or she may not have the right to dissociate from the partnership.

A partner's profit from a partnership is taxed as income to the firm.

In a limited partnership, a general partner's dissociation from the firm normally will lead to dissolution unless all partners agree to continue the business.

Some states have passed laws prohibiting the withdrawal of limited partners from a limited partnership.

Stefani and Tyler agree in an exchange of e-mail to form a partnership to buy and sell real property. Their partnership agreement is legally binding​

In a limited partnership, limited partners have essentially the same rights as general partners to participate in management.

A partner may pursue his or her own interests without automatically violating the partner's fiduciary duties to the partnership and the other partners.

Limits on a partner's authority normally are effective only with respect to third parties who are notified of the limitation.

On a partner's dissociation, his or her right to participate in the management and conduct of the business terminates.