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BLAW II > Exam 2 CHP 37,38,39 > Flashcards

Exam 2 CHP 37,38,39 Flashcards

1
Q

An association of two or more persons to carry on as co-owners of a business for profit.

A

Partnership

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2
Q

A business entity that has no tax liability.

A

Pass-through entity

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3
Q

True or false.
Joint ownership of property does in and of itself create a partnership.

A

False

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4
Q

What document is a partnership responsible for filing with the IRS?

A

Information Return

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5
Q

When a third person has reasonably and detrimentally relied on the representation that a nonpartner was part of a partnership.

A

Partnership by Estoppel

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6
Q

What are the fiduciary duties that a partner owes to the partnership?

A

Duty of care and loyalty

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7
Q

What are the 5 rights of partners?

A
  1. Management rights
  2. Interest in partnership
  3. Compensation
  4. Inspection and account of the books
  5. Property rights
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8
Q

A third party has the option of suing all of the partners together or one or more of the partners separately.

A

Joint and Several Liability

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9
Q

When a partner ceases to be associated in the carrying on of partnership business.

A

Dissociation

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10
Q

After a partner’s dissociation, his or her interest in the partnership must be purchased according to the rules in UPA 701.

A

Buyout

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11
Q

The process of collecting, liquidating, and distributing the partnership assets.

A

Winding up

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12
Q

True or False.
Creditors receive leftovers of the partnership before partners do after a dissolution.

A

True.

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13
Q

A hybrid form of business designed mostly for professionals who normally do business as partners in a partnership. Limits liability.

A

Limited Liability Partnership (LLP)

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14
Q

True or False
The supervising partner who oversees another partner is not liable for the partner’s negligent acts in the LLC.

A

False.

The supervising partner IS liable for the partner they oversee.

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15
Q

A partnership that limits the liability of some of its owners.

A

Limited Partnership (LP)

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16
Q

True or False.
Both general partners and limited partners are fully liable for the negligence of the partnership.

A

False.

Only the general partner has unlimited liability, where as the limited partner has limited liability based on their financial contribution(unless the limited partner is involved with management of the company, then they may be seen as a general partner involving litigation)

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17
Q

What is the difference between a Limited Partnership (LP) and a Limited Liability Limited Partnership (LLLP)?

A

A LP puts more liability on the general partner, whereas a LLLP puts liability on all partners based on their financial contribution (goes for both general and limited partners).

18
Q

Owners of a LLC are called…

A

Members

19
Q

A hybrid that combines the limited liability aspects of a corporation and the tax advantages of a partnership.

A

Limited Liability Company (LLC)

20
Q

To form an LLC, _____ must be filled with a central state agency - secretary of state office.

A

Articles of Organization

21
Q

Preformation contracts must be adopted by a corporation after they are formed. The process is called…..

A

Novation

22
Q

What are the 6 provisions of an LLC’s operating agreement?

A
  1. Who’s Management
  2. Who gets Profits
  3. How Membership Interests is transferred
  4. Dissociation and Dissolution
  5. Member Meetings - happen or not
  6. Voting Rights
23
Q

When two or more persons or business entities combine their efforts or their property for a single transaction or project or a related series of transactions or projects.

A

Joint Venture

24
Q

Several individuals or firms join together to finance a particular project. An investment group.

A

Syndicate

25
Q

A true hybrid of a partnership and a corporation. Ownership is represented by transferable shares of stock and it is managed by directors and officers of the company or association, and it can have perpetual existence.

A

Joint Stock Company

26
Q

An association that is organized to provide an economic service to its members(or shareholders). May be incorporated or not.

A

Cooperative

27
Q

Created by a written trust agreement that sets forth the interests of the beneficiaries and the obligations and powers of the trustees.

A

Business Trust

28
Q

A legal entity created and recognized by state law.

A

Corporation

29
Q

A company whose business activity consists of holding shares in another company.

A

Holding Company

30
Q

A corporation classification that a corporation’s home state uses.

A

Domestic Corporation

31
Q

A corporation classification that another state uses for a corporation.

A

Foreign Corporation

32
Q

A corporation classification used for corporations created out of country.

A

Alien Corporation

33
Q

A corporation who shares are held by relatively few persons, often members of a family.

A

Close Corporation

34
Q

How are shares dealt with in a close corporation?

A

They are traded and repurchased through the corporation and its shareholders.

35
Q

A corporation that can avoid the imposition of income taxes at the corporate level while retaining many of the advantages of a corporation. Must fill requirements.

A

S corporation

36
Q

A corporation designed for business that want to consider society and environment in addition to profit.

A

Benefit Corporation

37
Q

A party that serves the corporation that handles legal documentation and turning in of forming articles. Must be identified.

A

Registered Agent

38
Q

The primary document needed to incorporate a business.

A

Articles of Incorporation

39
Q

When a corporation has substantially complied with all condition precedent to incorporation. (Rightful and lawful)

A

De Jure Corporation

40
Q

When a corporation has a substantial defect in formation, or fails to hold an organization meeting to adopt bylaws.

A

De Facto Corporation

BLAW II (7 decks)

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