Unit 5 - Business Structure Law

Question 1

A business where the sole owner is responsible for the management, debts and liabilities of the business

Answer 1

Sole proprietorship

Question 2

A legal relationship between two or more persons for the purposes of carrying on a business with a view to make a profit

Answer 2

Partnership

Question 3

The termination of the partnership relationship

Answer 3

Dissolution

Question 4

A partner who may not actively participate in the management of the firm, but has limited liability

Answer 4

Limited partner

Question 5

A full partner with unlimited liability for the debts of the partnership

Answer 5

General partner

Question 6

A partnership where individual partners are liable for the general debts of the partnership and for personal negligence, but not personally liable for the negligence of the other partners

Answer 6

Limited liability partnership

Question 7

A business relationship between two corporations

Answer 7

Joint venture

Question 8

A type of legal entity created by the state that has an existence at law that is different than those that formed it

Answer 8

Corporation

Question 9

A person who holds interest in a corporation; a part owner of the corporation

Answer 9

Shareholder

Question 10

Under corporate law, a person elected by the shareholders of a corporation to manage its affairs.

Answer 10

Director

Question 11

A person elected or appointed by the directors of a corporation to fill a particular office (such as president, secretary, treasurer…)

Answer 11

Officer

Question 12

A rule that allows that the party dealing with a corporation may assume that the officers have the valid express authority to bind the corporation.

Answer 12

Indoor Management rule

Question 13

An agreement between shareholders of a private corporation concerning management and/or future reorganization of the corporation such as buy-out of interests.

Answer 13

Shareholders agreement