Ch 28 Vocab

Question 1

Person who has an ownership interest in a limited liability company.

Answer 1

Member *

Question 2

In limited liability company, an agreement in which members set forth the details of how the business will be managed and operated. State statues typically give members wide latitude in deciding for themselves the rules that will govern their organization.

Answer 2

Operating Agreement *

Question 3

Joint undertaking of a specific commercial enterprise by an association of persons. JV normally is not legal entity and is treated like a partnership for federal income tax purposes.

Answer 3

Joint Venture *

Question 4

Group of individuals/firms brought together for the purpose of financing a project that they would not/could not undertake independently; also called investment group.

Answer 4

Syndicated

Question 5

Hybrid for a business organization that combines characteristics of a corporation. Usually regarded as a partnership for tax and other legal purposes.

Answer 5

Joint Stock Company

Question 6

For of business organization in which investors (trust beneficiaries) transfer cash/property to trustees in exchange for trust certificates that rep their investment shares. Certificate holders shares trust profits but have limited liability.

Answer 6

Business Trust *

Question 7

Association, may or may not be incorporated, that is organized to provide an economic service to its members. Unincorporated cooperative are treated like partnerships for tax and other legal purposes.

Ex of cooperative are consumer purchasing cooperatives, credit cooperative & farmers cooperatives.

Answer 7

Cooperative

Question 8

Hybrid for a business enterprise that offers the limited liability of a corporation and tax advantages of a partnership.

Answer 8

Limited Liability Company (LLC) *