Question 1

An LLC is a legal entity with the authority to conduct business in its own name.

Accepted Answer

A) True 
 B)False

Question 2

The partners who manage the limited partnership and are personally liable for the firm debts are __________ partners.

Accepted Answer

A)  general
B)  active
C)  licensed
D)  unreserved

Question 3

A limited liability partnership must include which of the following terms in its name?

Accepted Answer

A)  LLP
B)  limited liability partnership
C)  either a.or b.
D)  neither a.nor b.

Question 4

In a limited partnership,general partners are not responsible for the debts of the firm.

Accepted Answer

A) True 
 B)False

Question 5

A limited partner can never lose money.

Accepted Answer

A) True 
 B)False

Question 6

Both general partnerships and limited partnerships are created only through the process of executing a certificate.

Accepted Answer

A) True 
 B)False

Question 7

A limited liability company may be classified as a partnership for tax purposes if:

Accepted Answer

A)  such an election is made by "checking the box" for partnership tax treatment on the appropriate Internal Revenue Service form.
B)  such an election is made in the operating agreement.
C)  such an election is made in the articles of incorporation.
D)  a majority of its members petition the Internal Revenue Service for partnership tax treatment.

Question 8

Every limited partnership must have at least one general partner.

Accepted Answer

A) True 
 B)False

Question 9

The owners of a limited liability company are known as:

Accepted Answer

A)  members.
B)  partners.
C)  contributors.
D)  electors.

Question 10

The limited liability company combines the tax advantage of the partnership with the limited liability feature of the corporate form of business organization.

Accepted Answer

A) True 
 B)False

Question 11

The dissolution of a limited partnership is governed by unique rules quite different from those applicable to the dissolution of a general partnership.

Accepted Answer

A) True 
 B)False

Question 12

The spread of limited liability corporation statutes resulted from:

Accepted Answer

A)  a United States Supreme Court decision.
B)  an Internal Revenue Service ruling.
C)  a Wyoming Supreme Court decision.
D)  a Securities and Exchange Commission ruling. B

Question 13

Which of the following statements regarding limited partnerships is true?

Accepted Answer

A)  The words limited partnership or simply LP must appear in the firm's name.
B)  General partners cannot avoid personal liability by incorporating.
C)  Limited partners can lose their liability limitation if they participate in the control of the business.
D)  All of the statements are true.

Question 14

You are asked to provide two friends who are in business together with advice regarding what they need to do to legally in order to form a limited liability company.Although your friends like the general notion of limited liability in the operation of their business,they are totally unfamiliar with the legal processes for forming a LLC,so you need to provide them with the basic requirements for LLC creation.What specific advice would you give them?

Accepted Answer

A limited liability company comes into e...

Question 15

A limited liability company's operating agreement:

Accepted Answer

A)  is equivalent to the bylaws of a corporation.
B)  must be in writing.
C)  does not cover member compensation..
D)  all of the above.

Question 16

Managers of an LLC have the same fiduciary duties to the entity as corporate officers have to a corporation.

Accepted Answer

A) True 
 B)False  True

Question 17

A limited liability company:

Accepted Answer

A)  must have at least one member that is subject to unlimited liability.
B)  member may actively participate in control of the business without losing limited liability status.
C)  both a.and b.
D)  neither a.nor b.

Question 18

Limited partners may contribute cash or property as their capital contributions.

Accepted Answer

A) True 
 B)False

Question 19

Under the Revised Uniform Limited Partnership Act,a limited partner probably will not lose the protection of limited liability when the limited partner:

Accepted Answer

A)  becomes a contractor for,or an agent or employee of,the limited partnership or of a general partner.
B)  consults with and advises a general partner regarding the partnership business.
C)  votes on partnership matters,such as dissolving and winding up the limited partnership or removing a general partner.
D)  all of the above.

Question 20

It is impossible to form a business in a manner that allows for single taxation and limited liability.

Accepted Answer

A) True 
 B)False  False

Exam 43: LPs, LLCs, and LLPs

An LLC is a legal entity with the authority to conduct business in its own name.

Correct Answer
verified

The partners who manage the limited partnership and are personally liable for the firm debts are __________ partners.

Correct Answer
verified

A limited liability partnership must include which of the following terms in its name?

Correct Answer
verified

In a limited partnership,general partners are not responsible for the debts of the firm.

Correct Answer
verified

A limited partner can never lose money.

Correct Answer
verified

Both general partnerships and limited partnerships are created only through the process of executing a certificate.

Correct Answer
verified

A limited liability company may be classified as a partnership for tax purposes if:

Correct Answer
verified

Every limited partnership must have at least one general partner.

Correct Answer
verified

The owners of a limited liability company are known as:

Correct Answer
verified

The limited liability company combines the tax advantage of the partnership with the limited liability feature of the corporate form of business organization.

Correct Answer
verified

The dissolution of a limited partnership is governed by unique rules quite different from those applicable to the dissolution of a general partnership.

Correct Answer
verified

The spread of limited liability corporation statutes resulted from:

Correct Answer
verified
B

Which of the following statements regarding limited partnerships is true?

Correct Answer
verified

Correct Answer
verified
A limited liability company comes into e...
View Answer

A limited liability company's operating agreement:

Correct Answer
verified

Managers of an LLC have the same fiduciary duties to the entity as corporate officers have to a corporation.

Correct Answer
verified
True

A limited liability company:

Correct Answer
verified

Limited partners may contribute cash or property as their capital contributions.

Correct Answer
verified

Under the Revised Uniform Limited Partnership Act,a limited partner probably will not lose the protection of limited liability when the limited partner:

Correct Answer
verified

It is impossible to form a business in a manner that allows for single taxation and limited liability.

Correct Answer
verified
False

Exam 43: LPs, LLCs, and LLPs

An LLC is a legal entity with the authority to conduct business in its own name.

Correct AnswerverifiedShow Answer

The partners who manage the limited partnership and are personally liable for the firm debts are __________ partners.

Correct AnswerverifiedShow Answer

A limited liability partnership must include which of the following terms in its name?

Correct AnswerverifiedShow Answer

In a limited partnership,general partners are not responsible for the debts of the firm.

Correct AnswerverifiedShow Answer

A limited partner can never lose money.

Correct AnswerverifiedShow Answer

Both general partnerships and limited partnerships are created only through the process of executing a certificate.

Correct AnswerverifiedShow Answer

A limited liability company may be classified as a partnership for tax purposes if:

Correct AnswerverifiedShow Answer

Every limited partnership must have at least one general partner.

Correct AnswerverifiedShow Answer

The owners of a limited liability company are known as:

Correct AnswerverifiedShow Answer

The limited liability company combines the tax advantage of the partnership with the limited liability feature of the corporate form of business organization.

Correct AnswerverifiedShow Answer

The dissolution of a limited partnership is governed by unique rules quite different from those applicable to the dissolution of a general partnership.

Correct AnswerverifiedShow Answer

The spread of limited liability corporation statutes resulted from:

Correct AnswerverifiedB

Which of the following statements regarding limited partnerships is true?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedA limited liability company comes into e...View AnswerShow Answer

A limited liability company's operating agreement:

Correct AnswerverifiedShow Answer

Managers of an LLC have the same fiduciary duties to the entity as corporate officers have to a corporation.

Correct AnswerverifiedTrue

A limited liability company:

Correct AnswerverifiedShow Answer

Limited partners may contribute cash or property as their capital contributions.

Correct AnswerverifiedShow Answer

Under the Revised Uniform Limited Partnership Act,a limited partner probably will not lose the protection of limited liability when the limited partner:

Correct AnswerverifiedShow Answer

It is impossible to form a business in a manner that allows for single taxation and limited liability.

Correct AnswerverifiedFalse

Correct Answer
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B

Correct Answer
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Correct Answer
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A limited liability company comes into e...
View Answer

Correct Answer
verified

Correct Answer
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True

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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False