Chapter 16 quiz Flashcards
Carl starts up, and assumes the financial risk of, DataWorks, a new Web marketing enterprise. Carl and DataWorks must meet legal requirements relating to
a. all of the choices.
b. business name and state tax registration.
c. intellectual property laws.
d. occupational licensing.
a
Chet is a partner in Diligent Accounting Service. Chet can inspect Diligent’s books and records
a. only in relation to Chet’s capital contribution.
b. only for a reasonable purpose.
c. in their entirety.
d. only as the firm’s management permits
c
Craig, Donna, and Eve do business as Fast-Track Career Consultants. Eve’s relationship to Fast-Track ends, but the firm continues to do business. This is
a. most likely illegal.
b. dissolution.
c. dissociation.
d. unethical.
c
Kristin and Lindsey are partners in Mobile Devise, an online marketing firm.
Refer to Fact Pattern 16-1. Lindsey dissociates from Mobile. Kristin signs a contract with Organic Olives, a food seller, apparently on Mobile’s behalf. Organic Olives does not know of Lindsey’s dissociation. The contract is binding on
a. Organic Olives only.
b. Kristin only.
c. Kristin, Lindsey, and Mobile.
d. Mobile only.
c
Gwen and Hugo do business as Gwen & Hugo Civil Engineers, a partnership. This firm is governed by the Uniform Partnership Act
a. in the absence of an express agreement.
b. in the absence of an implied agreement.
c. only under an express agreement.
d. under all circumstances.
a
Instead of setting up a business to market her own products, Rita considers entering into a distributorship franchise with Sports Equipment Corporation. This involves the transfer of
a. the ownership of the business.
b. the formula to make a certain product.
c. a trade name.
d. a license.
d
Kay and Linda decide to do business as Marketing & Promotion. To be a partnership, this association can result from an agreement that is
a. implied, but not express.
b. written, but not oral or implied.
c. oral, written, or implied by conduct.
d. express, but not implied.
c
Lee wants to go into the business of architectural design. Among the reasons that might convince Lee to set up his business as a sole proprietorship would be
a. the ease of transferring the business to other family members.
b. its greater organizational flexibility.
c. its perpetual existence.
d. its limited liability.
b
Made in the USA Clothing Inc. gives notice to Neely that it is terminating their franchise arrangement. Winding up the business requires
a. the return of the franchisor’s property.
b. nothing more than closing immediately.
c. a new franchise agreement.
d. Neely’s death, disability, or insolvency.
a
Nora and Owen do business as Profit & Property, a real estate investment partnership. In acting on the firm’s behalf in a deal with Village Mall, Nora takes advantage of an opportunity to make a secret profit on her own behalf. To her firm, Nora is liable for
a. breach of the duty of care.
b. breach of contract.
c. nothing.
d. breach of the duty of loyalty.
d
