Question 1

Many states have eased filing requirements to create an LLC from requiring extensive amounts of information to now requiring minimal information similar to that required in a corporate filing.

Accepted Answer

A) True 
 B)False

Question 2

LLCs are frequently governed by agreement of the parties called an LLC agreement or _______.

Accepted Answer

The answer of LLCs are frequently governed by agreement of...

Question 3

An LLC:

Accepted Answer

A)   offers principals the same liability coverage as principals in corporations with taxation at the business entity level.
B)   offers principals the same liability coverage as principals in corporations with pass through taxation.
C)   offers principals the same liability coverage as general partners in a partnership with taxation at the business entity level.
D)   offers principals the same liability coverage as limited partners in a partnership with pass through taxation B

Question 4

LLPs were created to:

Accepted Answer

A)   limit taxation burdens existing in LLCs.
B)   ease the costs and filing requirements present with LLCs.
C)   provide limited protections for general partners increasing protections offered by LLCs.
D)   increase the duration of the business entity permitted under LLC statutes

Question 5

When an LLP is formed,who files the initial paperwork?

Accepted Answer

A)   an individual representing two or more persons desiring to start a new business
B)   the principal in a sole proprietorship already in operation
C)   a limited partnership already in operation
D)   a general partnership already in operation

Question 6

Several people have decided to go into business as an LLC.To cover all contingencies,specifying what will constitute an act of dissociation and specifying the procedures upon dissolution would be included in the:

Accepted Answer

A)   certificate of organization.
B)   operating agreement.
C)   Uniform Limited Liability Company Act.
D)   common law because the members may not negotiate these rights

Question 7

Burt has gone to a commercial bank to negotiate a loan for the LLC in which he is a member.He tells you that he is authorized to act on behalf of and to bind the company.What is the best way for you to verify whether Burt does in fact have the authority he claims?

Accepted Answer

A)   get him to sign a written statement
B)   call another member of the LLC for confirmation
C)   check the articles of organization
D)   nothing need be done because all LLC members have the right to bind the company as do general partners

Question 8

Some states recognize LLCs but do not permit partnership taxation at the state level.

Accepted Answer

A) True 
 B)False

Question 9

LLCs may choose to be taxed as a pass through entity or may elect to be taxed as a corporation.

Accepted Answer

A) True 
 B)False

Question 10

Federal regulations regarding franchises are primarily designed to:

Accepted Answer

A)   ensure full disclosure of all information relating to a franchise company prior to a franchise investment.
B)   ensure the federal tax guidelines are met.
C)   ensure that the public is protected from fraud or other injuries.
D)   ensure that the franchisee has the requisite knowledge to manage a business and be sure the franchisee is not entering a business relationship they are not equipped to financially handle

Question 11

LLC laws define dissolution of an LLC as a ________ process.

Accepted Answer

The answer of LLC laws define dissolution of an LLC...

Question 12

Jones LLC and Smith LLC both have ten members and five managing members.Both entities go into dissolution.The procedures for dissolution including preferences of members in terms of who is paid first and so on will be identical for both companies.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is not a true business entity?

Accepted Answer

A)   an LLC
B)   an LLP
C)   a franchise
D)   a sole proprietorship

Question 14

The first LLP legislation was enacted in:

Accepted Answer

A)   New York.
B)   Texas.
C)   Florida.
D)   Iowa

Question 15

The Certificate of Organization may restrict members of an LLC to only those possessing a professional license in a named field.

Accepted Answer

A) True 
 B)False

Question 16

Stop Now LLP manufactures brake linings and sells their product to repair and maintenance shops for use as replacements for worn brakes.When Stop Now approaches Coastal Garage,they offer a very good price for their products.Coastal is a nationwide company and the order would be very large.The management at Coastal is very interested in dealing with Stop Now but is concerned with the LLP's limited liability protections for Stop Now's partners.What could Coastal due to protect themselves from the LLP's limited liability protections?

Accepted Answer

Two things may be done to provide Coasta...

Question 17

Financial information provided to a prospective franchisee must be audited.

Accepted Answer

A) True 
 B)False  True

Question 18

The name of an LLC must contain a designator such as "Company","Limited","Limited Liability Company" or "LLC".

Accepted Answer

A) True 
 B)False

Question 19

The operating agreement of the LLC often controls the amount and methods of capitalizing the business.

Accepted Answer

A) True 
 B)False  True

Question 20

All states require LLPs to have a written partnership agreement.

Accepted Answer

A) True 
 B)False

Exam 14: Limited Liability Partnerships, limited Liability Companies, and Other Business Arrangements

Many states have eased filing requirements to create an LLC from requiring extensive amounts of information to now requiring minimal information similar to that required in a corporate filing.

Correct Answer
verified

LLCs are frequently governed by agreement of the parties called an LLC agreement or _______.

Correct Answer
verified

An LLC:

Correct Answer
verified
B

LLPs were created to:

Correct Answer
verified

When an LLP is formed,who files the initial paperwork?

Correct Answer
verified

Several people have decided to go into business as an LLC.To cover all contingencies,specifying what will constitute an act of dissociation and specifying the procedures upon dissolution would be included in the:

Correct Answer
verified

Burt has gone to a commercial bank to negotiate a loan for the LLC in which he is a member.He tells you that he is authorized to act on behalf of and to bind the company.What is the best way for you to verify whether Burt does in fact have the authority he claims?

Correct Answer
verified

Some states recognize LLCs but do not permit partnership taxation at the state level.

Correct Answer
verified

LLCs may choose to be taxed as a pass through entity or may elect to be taxed as a corporation.

Correct Answer
verified

Federal regulations regarding franchises are primarily designed to:

Correct Answer
verified

LLC laws define dissolution of an LLC as a ________ process.

Correct Answer
verified

Jones LLC and Smith LLC both have ten members and five managing members.Both entities go into dissolution.The procedures for dissolution including preferences of members in terms of who is paid first and so on will be identical for both companies.

Correct Answer
verified

Which of the following is not a true business entity?

Correct Answer
verified

The first LLP legislation was enacted in:

Correct Answer
verified

The Certificate of Organization may restrict members of an LLC to only those possessing a professional license in a named field.

Correct Answer
verified

Correct Answer
verified
Two things may be done to provide Coasta...
View Answer

Financial information provided to a prospective franchisee must be audited.

Correct Answer
verified
True

The name of an LLC must contain a designator such as "Company","Limited","Limited Liability Company" or "LLC".

Correct Answer
verified

The operating agreement of the LLC often controls the amount and methods of capitalizing the business.

Correct Answer
verified
True

All states require LLPs to have a written partnership agreement.

Correct Answer
verified

Exam 14: Limited Liability Partnerships, limited Liability Companies, and Other Business Arrangements

Many states have eased filing requirements to create an LLC from requiring extensive amounts of information to now requiring minimal information similar to that required in a corporate filing.

Correct AnswerverifiedShow Answer

LLCs are frequently governed by agreement of the parties called an LLC agreement or _______.

Correct AnswerverifiedShow Answer

An LLC:

Correct AnswerverifiedB

LLPs were created to:

Correct AnswerverifiedShow Answer

When an LLP is formed,who files the initial paperwork?

Correct AnswerverifiedShow Answer

Several people have decided to go into business as an LLC.To cover all contingencies,specifying what will constitute an act of dissociation and specifying the procedures upon dissolution would be included in the:

Correct AnswerverifiedShow Answer

Burt has gone to a commercial bank to negotiate a loan for the LLC in which he is a member.He tells you that he is authorized to act on behalf of and to bind the company.What is the best way for you to verify whether Burt does in fact have the authority he claims?

Correct AnswerverifiedShow Answer

Some states recognize LLCs but do not permit partnership taxation at the state level.

Correct AnswerverifiedShow Answer

LLCs may choose to be taxed as a pass through entity or may elect to be taxed as a corporation.

Correct AnswerverifiedShow Answer

Federal regulations regarding franchises are primarily designed to:

Correct AnswerverifiedShow Answer

LLC laws define dissolution of an LLC as a ________ process.

Correct AnswerverifiedShow Answer

Jones LLC and Smith LLC both have ten members and five managing members.Both entities go into dissolution.The procedures for dissolution including preferences of members in terms of who is paid first and so on will be identical for both companies.

Correct AnswerverifiedShow Answer

Which of the following is not a true business entity?

Correct AnswerverifiedShow Answer

The first LLP legislation was enacted in:

Correct AnswerverifiedShow Answer

The Certificate of Organization may restrict members of an LLC to only those possessing a professional license in a named field.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedTwo things may be done to provide Coasta...View AnswerShow Answer

Financial information provided to a prospective franchisee must be audited.

Correct AnswerverifiedTrue

The name of an LLC must contain a designator such as "Company","Limited","Limited Liability Company" or "LLC".

Correct AnswerverifiedShow Answer

The operating agreement of the LLC often controls the amount and methods of capitalizing the business.

Correct AnswerverifiedTrue

All states require LLPs to have a written partnership agreement.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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B

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Two things may be done to provide Coasta...
View Answer

Correct Answer
verified
True

Correct Answer
verified

Correct Answer
verified
True

Correct Answer
verified