Cengage and quizes with added volcab Flashcards
Liens generally take priority over other claims against the same property
True
A court awards a judgment to Loan Collection Agency, who is the creditor,
against Margret, who is the debtor. After the judgment, the creditor
requests a court order to seize Margret’s property to ensure that the
judgment will be collectible. This is
writ of execution
Only a few types of property—a debtor’s wages or bank account, for
example—can be garnished.
False
Contracts in which creditors discharge debtors’ debts for amounts less
than what is owed are referred to as composition agreements.
True
A surety can be required to pay an obligation only after the principal
debtor defaults and usually only after the creditor has made an attempt
to collect from the debtor.
False
Ridgeline Bank provides Shirley with a mortgage to buy a home. The rate
of interest is xed for three years and then adjusts annually. This is
an adjustable-rate mortgage
If a homeowner defaults, or fails to make the mortgage payments, the
lender has the right to foreclose on the mortgaged property.
True
Erin and Dooley, a married couple, borrow $120,000 from Capital & Credit
Bank to buy a home. When Erin and Dooley divorce, they are unable to
make payments on the mortgage. The market value of the home has
declined to less than the balance of the loan. Capital & Credit agrees to a
sale of the property for this amount. This is
a short sale
Nancy joins with other creditors to force Odette, a debtor, into
bankruptcy. One of the goals of bankruptcy law with respect to creditors
is to
ensure equitable treatment of creditors who are competing for a
debtor’s assets.
Roland les a petition in bankruptcy. After all his assets have been sold
and the proceeds distributed among his creditors, Roland’s remaining
debts
are discharged
An involuntary bankruptcy occurs when the debtor forces his or her
creditors into bankruptcy proceedings.
False
Gerald les a petition in bankruptcy. An automatic stay will apply to
actions by creditors seeking to collect Gerald’s debts comprised of
car payments
The FTC is charged by Congress with the broadly stated goal of preventing
unfair and deceptive trade practices.
True
A sanction known as counteradvertising requires a company to advertise
anew to inform the public about earlier misinformation.
True
Advertising that contains an endorsement by a celebrity will not be
deemed deceptive.
False
Puery constitutes deceptive advertising.
False
Through careless manufacturing practices, Metalworks Company makes
and distributes unsafe products that are sold to Nabi and other
consumers. This may be subject to sanctions under
federal and state law
Mouth & Gums, Inc. (CSI), engages in de ceptive advertising when it
markets its product Oral Rinse as able to kill germs over long periods of
time. In an action against Mouth & Gums, the rm is ordered to stop its
false advertis ing of Oral Rinse and other products. This is
a multiple product order
Sweet Treats, Inc., wants to market a new snack food. On the prod uct’s la -
bel, standard nutrition facts are
required
Under federal law, the calorie content of the food on a menu must be
posted by Organic Mix, LLC, if Organic Mix is
a restaurant chain with twenty or more locations
The agency with the chief responsibility to prevent unsafe food and drugs
from being sold is
the FDA
Tory borrows $10,000 from USA National Bank to remodel a room in her
home. This transaction is subject to
the Truth-in-Lending Act
QuikPay Inc. extends credit to consumers. QuikPay is subject to the Equal
Credit Opportunity Act, which prohibits credit dis crimination based on
race
Jasmine receives an unsolicited credit card in the mail and tosses it on her
desk. Without Jasmine’s permission, her roommate Ilene uses the card to
buy a new tablet for $500. Jasmine is
not liable for any amount
Debt & Loan Collection Agency calls Ethel several times a day, and some -
times in the middle of the night, about an overdue bill that a Furniture4U
store turned over to Debt & Loan for collection. This is a violation of
the Fair Debt Collection Practices Act
Kip opens an account at a Lotsa Goodies Store, and buys a digital music
player and other items, but makes no payments on the account. To collect
the debt, Mako, the manager, contacts Kip’s parents. This violates
no federal law
what is a write of execution
a judicial order that a judgement be enforced
In choosing a form of business organization for a new enterprise,
important factors include the ability to raise capital
True
The intent to associate is a key element of a partnership.
True
The partnership is a pass-through entity and a taxpaying entity.
False
A franchisee is generally legally independent of the franchisor
True
Kari is the sole proprietor of Living Earth Garden Shop. As a sole
proprietor, on the business’s prots, Kari pays
only personal income taxes
Silvano owns Textbooks Plus, a sole proprietorship that sells textbooks
and other school supplies. When Silvano dies, Textbooks Plus will
automatically
dissolve
Noah and Orin do business as Personnel Providers, an employment
agency. In most states, for purposes of suing and being sued, Personnel
Providers, which is a partnership, would be treated as
an entity
Luke and Maya form Northwest Air Express, a general partnership. The
essential elements of this partnership do not include
goodwill
Pualani and Quentin do business as partners in Rio Vista Builders, a
residential construction rm. For federal income tax purposes, Rio Vista
would be treated as
a pass-through entity
Paradise Footwear buys a franchise from Quadrangle Athletic Shoes Inc.
This rela tionship, like all other franchise relationships, is governed by
contract law
Members of limited liability companies are shielded from personal liability
in many situations.
True
Limited liability companies are entities apart from their owners.
True
A limited liability company can be taxed as a partnership.
True
A limited liability company can be held liable for any loss or injury caused
by the wrongful acts or omissions of its members.
True
In a limited partnership, a limited partner has full responsibility for the
partnership and for all its debts.
False
Bee Hive Honey, LLC’s members include Chad, Dolores, and others. For
purposes of suing and being sued, Bee Hive Honey is
a legal entity apart from the owners
Arnie is a member of Bowling & Billiards, LLC, a limited liability company.
Arnie can participate in the rm’s management
to any extent
Hillside Vineyards is a family limited liability partnership. All of the
partners must be
natural persons or persons acting as duciaries for natural persons
Nikki and Orlando are limited partners in Port City Exports, a lim ited part -
ner ship. To avoid personal liability for partnership obligations, they must
not
participate in the rm’s management
Buckley is a general partner in Cut-Rate Shipping, LLLP, a limited liability
lim ited partnership, which cannot pay its debts. Buckley is personally li -
able for the debts
to no extent
One of the key advantages of the corporate form is the unlimited liability
of its owners.
False
Shareholders have the power to vote to elect or remove members of the
board of directors.
True
Dollars & Sense, Inc., is incorporated in the state of New Jersey and is
doing busi ness in the state of New York. In New York, Dollars & Sense is
properly referred to as
a foreign corporation
The shares of Home Mortgage Corporation are publicly traded in
securities mar kets. Home Mortgage Corporation is
a publicly held corporation
If a corporation has S corporation status, it can avoid the imposition of
income taxes at the corporate level.
True
There are no important consequences if the procedures for incorporation
are not followed precisely.
False
The articles of incorporation serve as a primary source of authority for the
corporation’s future organization and business functions.
True
Lewis is a director of Mines & Reneries, Inc. Using information that is not
available to the public, Lewis makes a prot trading in Mines & Reneries
stock. Lewis is most likely li able for breach of
the duty of loyalty
Eloise is a director for Frozen Yogurt Company. Eloise is also a director for
Gelato Desserts, Inc. When the board of Frozen Yogurt considers entering
into a contract with Gelato Desserts, Eloise must
make a full disclosure of any conict of interest
Farrah and Grant are shareholders of Hong Kong Restaurants, Inc. As
shareholders, they must approve
conducting a merger
Agency relationships do not permeate the business world.
False
The agent has the right to be compensated, to be reimbursed and
indemnied, and to have a safe working environment
True
An agent has the implied authority to do what is reasonably necessary to
accomplish the objectives of the agency.
True
Under the doctrine of respondeat superior, a principal may be liable for
any harm that his or her agent causes to a third party.
True
A principal or employer normally is not liable for an agent’s crime even if
the crime was committed within the scope of authority or employment.
True
Jewelry & Coin Company hires Kelly Ann to buy gems and precious metals
from various sources on its behalf. In this relationship, Jewelry & Coin is
a principal
California Produce Company hires Drew to work on California Produce’s
shipping dock, checking outgoing loads and dispatching the company’s
drivers. With respect to California Produce, Drew is most likely
an agent
Sybil agrees with Tyrone and other professional athletes to sign contracts
with promoters and others on the athletes’ behalf. Sybil is
an agent
Ingmar asks Jessie to contract with Jessie’s high school classmates to
babysit Ingmar’s new baby. Jessie orally agrees to do so. This is
an agency by agreement
Lucille is married to Marcus. Lucille buys food for their children’s lunches
and charges the cost to Marcus’s account. This is
an agency by operation of law
Bernard is an expert on exotic owers. Custom Floral Arrangements, Inc.,
hires Bernard to order exotic owers for its arrangements. Bernard does
not examine the quality of the owers he orders on behalf of Custom
Floral. Bernard has breached
the duty of performance
Home Enterprises employs Itzak to buy property for a possible residential
development. Itzak secretly buys some of the property and sells it to
Home Enterprises at a prot. Itzak has breached
the duty of loyalty
Trucking Dispatch Company and Ucello put their agency agreement into a
written document that describes the rights and duties of both parties.
Ucello, as the agent, has
express authority
Garry drives a truck as an employee for Heavy Hauling, Inc. Garry would
most likely be considered acting outside the scope of his employment if
he
crashed into a car at the airport while o duty.
Bayou Development Corporation hires Coastal Brokerage Associates to
sell the condominiums in a building at Bayou Development’s resort. The
agency will terminate
after the condos have been sold
Generally, under employment-at-will doctrine, an employer may re an
employee even if doing so would violate a federal or state statute.
False
Febo is an employee of Guitar & Drum Company. Guitar & Drum’s
employee manual states that workers, such as Febo, will be dismissed
only for good cause. With respect to the employment-at-will doctrine, this
is
an exception based on contract theory
Certain employees are exempt from federal overtime provisions
True
An employer can voluntarily pay overtime to ineligible employees.
True
Certain employers must provide advance notice of a layo to the aected
workers.
True
Hauser takes temporary family leave from his job at Gelato Confectionary
Corporation to care for a new baby. On Hauser’s return from the leave,
Gelato must
restore Hauser to his original position
Livia takes temporary family leave from her job at Meatpackers
Corporation to care for a new baby. On Livia’s return from the leave,
Meatpackers must
restore Livia to her original position
Employers have a general duty to keep workplaces safe.
True
To recover workers’ compensation, an employee must prove that an
injury did not occur on the job or in the course of employment.
False
Like Social Security, Medicare is funded by contributions from the
employer and the employee
True
Employers are required to establish retirement plans for their employees.
False
Most employers with fty or more employees are required to oer healthinsurance benets.
True
Investment Sales Corporation wants to monitor its employees’ electronic
com munications. Investment Sales’s best course of action to avoid liability
under laws related to employee monitor ing is to notify
its employees
Data & Data Accountants, a private employer, handles bookkeeping for
small employers. In most circumstances, with exceptions, federal law
clearly pro hibits Data & Data from subjecting its employees to
lie-detector tests
Neville, a member of a protected class, applies for a job with Origami
Paper Products Corporation, but fails the company’s employment test and
is not hired. Neville believes that the test has an unintentionally
discriminatory eect. If so, this is
disparate-impact discrimination
Insurance Sales Corporation gives preferential treatment in hiring and
promotion to the members of all protected classes. This treatment results
in discrimination against members of the majority. This is
reverse discrimination
Ruta is a supervisor for Subs & Suds, a restaurant. Tim is a Subs
employee. The owner announces that some em ployees will be
discharged. Ruta tells Tim that for sexual favors she will give him an
excellent performance review and recommend a raise. This is
quid pro quo harassment
Conrad and Delilah are employees of EcoCrop Feed & Seed Corporation.
Under the Equal Pay Act of 1963, EcoCrop can legitimately pay dierent
wages on the basis of
seniority
Elsa participates in an investigation into possible violations of the Civil
Rights Act of 1964 at Fabrication Foundry, Inc., where she works. As a
result, Elsa’s employer demotes her. Elsa can le a
retaliation claim
Boni, the owner of Café Rico, knows about, but does not take any action
to prevent, the sexual harassment of employees. Boni and the café may
be liable for such harassment by
a customer or a co-worker
Kyla replaces Lomax in his job at Motor Vehicle Manufacturing
Corporation (MVMC). Lomax believes that he has been discriminated
against on the basis of his age. For the Age Discrimination in Employment
Act of 1967 to apply
Lomax must be forty years of age or older
Helene, a disabled person, applies for a job at Industrial Engineering
Applications Inc. for which she is well quali ed, but for which she is
rejected. Industrial Engineering continues to seek applicants and
eventually lls the posi tion with a person who is not disabled. Helene is
most likely to succeed in a suit against Industrial Engineering for
discrimination under the Americans with Disabilities Act of 1990 if she can
show that
she was not hired solely because of her disability
Merlin is a drug addict who has completed a supervised drugrehabilitation program. Nabil used drugs casually in the past. Both work
for Omni Insurance & Investments Inc. Considered to have a disability
under the Americans with Disabilities Act of 1990
is Merlin only
Lumber Mill Inc. is a private employer with more than twenty employees.
Its employment practices do not indicate a past pattern of discrimination.
It is located in Metro City, which has recently seen an increase in the
number of its citizens who are members of protected classes. Under the
Civil Rights Act of 1964, Lumber Mill is
not required to implement an armative action policy
