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LAW531 LAW/531 WEEK 1 QUIZ

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Question;1. When parties agree in advance to;adhere to an arbitrator?s decision and award, it is known as;binding arbitration;appealable;arbitrator discretion;mediation;2. Which of the following is true of a corporation?;Corporation shareholders are subject to unlimited;personal liability.;Corporation owners are only taxed once on earnings.;A corporation terminates upon the death of an owner.;A corporation is a separate legal entity.;3. Martha started a flower shop as a sole;proprietor. After 1 year, she was forced to close the shop because business was;so bad. At that time, the business assets totaled $50,000, but the business;liabilities totaled $125,000. Which of the following statements is true?;Martha?s business creditors can collect only the $50,000 of business assets.;Martha?s business creditors can collect only the $50,000 now, but if Martha;ever goes into business again, they can get the assets of the new business.;Once Martha terminates the sole proprietorship, she is no longer liable for;the $50,000.;Martha is personally liable for the additional $75,000 owed to business;creditors.;4. Which of the following is true of The Federal;Arbitration Act?;It permits an appeal for all arbitration awards.;It provides that arbitration agreements are valid, irrevocable, and;enforceable.;It governs all types of alternative dispute resolution.;It applies only to breach of contract disputes.;5. Which of the following is true about the choice;of business entity for an entrepreneur?;The choice is determined solely by whether the primary business is;services or goods.;The choice takes into account many factors, including finding an option that;has all the characteristics desired.;The choice is determined by the Internal Revenue Service based on all the;facts and circumstances.;The choice is determined solely by the amount of capital invested.;6. Which of the following is true regarding;mediation?;If a settlement agreement is not reached in mediation, then the parties;hire a new mediator.;A mediator does not make a decision or an award.;A settlement agreement is never reached with a mediator.;Was created by the Federal Mediation Act of 1925.;7. Which of the following is true in the creation of;a general partnership?;The business name must have the names of all the partners.;The business name cannot be a fictitious name.;The name selected cannot indicate that it is a corporation.;The business cannot operate under a trade name.;8. Which form of alternative dispute resolution;occurs when the parties choose an impartial third party to hear and decide;their dispute?;Conciliation;Arbitration;Mediation;Minitrial;9. The Black Squirrel limited partnership has been;in operation for many years, but has recently fallen on hard times. The;partners have decided to dissolve, although there are few assets remaining in;the partnership. Shortly after the partnership filed its certificate of limited;partnership, the partners had the foresight to incorporate into their;partnership agreement a provision that, in the event of dissolution, the assets;would be distributed in payment of claims first to limited partners, then to;general partners, then to creditors. Hilda is a limited partner and feels;relieved that she will receive at least a portion of her capital. Henry, one of;the general partners, said that this provision is void and unenforceable. Which;of the following best describes this situation?;The distribution, as called for in the agreement, would be enforceable;if it had been included in any filings related to the limited partnership.;The distribution of assets in the event of dissolution is one of the few;provisions where the Revised Uniform Limited Partnership Act does not allow;modification.;The provision placing the partners ahead of creditors is not enforceable;but the priority of limited partners over general partners is enforceable.;The provision placing limited partners ahead of general partners is;unenforceable, thus all partners would be on an equal footing and ahead of;creditors.;10. What is the effect of having a corporation as;the general partner of a limited partnership?;The liability of the corporate general partner will be limited to the;amount of its assets.;The limited liability of the corporation will result in the limited partners;having greater liability than they would otherwise.;Each shareholder of the corporation will be treated as a limited partner of;the limited partnership.;Each shareholder of the corporation will be treated as a general partner of;the limited partnership.;11. Which type of business formation is typically;reserved for professionals such as accountants, lawyers, and doctors?;Limited Liability Partnership (LLP);S-Corporation;Limited Liability Company (LLC);Franchise;12. Which of the following is true of arbitration?;One party usually drops the case.;A resolution may or may not be reached.;A judicial referee makes recommendations to the parties.;Parties can introduce evidence to support their case.;13. Which of the following is one of the major;purposes of a settlement conference?;To contest the local court rules;To facilitate the settlement of a case;To conduct discovery for a case;To structure a settlement payment schedule;14. George has served Mary with a complaint alleging;breach of contract. Mary has never been sued before and as such, she seeks your;advice on what to do with the complaint. You advise that she;answer George?s complaint but do not provide any affirmative defenses;that George can use against her;answer George?s complaint by admitting or denying the allegations George has;asserted against her;write a letter to the judge saying that George is mistaken;should not respond to George?s complaint as an answer implies an admission;15. Fred and Ginger are general partners in a;business. They decide to purchase a building for the partnership. Ginger will;put up the money for the building, and Fred will complete the remodeling. While;inspecting the building, Fred is informed that the building is packed full of;asbestos. He fails to tell Ginger of the presence of the substance. They buy;the building and go into business. During the remodeling of the building;people from the neighborhood begin complaining about the dust from the;building. Some of them even threaten to sue. Who is liable?;Fred is liable because he was put on notice of the presence of the;substance. Ginger is not liable because she did not have actual knowledge.;Both Ginger and Fred are liable, regardless of the circumstances, by virtue;of the fact that they are partners.;Neither Ginger nor Fred are liable personally, nor is the partnership, as;they did not put the substance in the building.;Ginger is liable because she is the one who purchased the building. Fred is;not liable, even though he had actual knowledge, because he did not purchase;the building.;16. There are two general partners, each of whom;contributes $5,000 in capital to a limited partnership. There are two limited;partners, each of whom contributes $20,000. The total amount of capital;contributed is $50,000. The limited partnership agreement does not stipulate;how profits and losses are to be allocated. Assume that the limited partnership;makes $300,000 in profits. Under the Revised Uniform Limited Partnership;Act (RULPA), how much would each partner receive?;Each general partner would receive $50,000, and each limited partner would;receive $100,000.;Each general partner would receive $30,000, and each limited partner would;receive $120,000.;Each general partner would receive $120,000, and each limited partner would;receive $30,000.;All partners would receive $75,000, regardless of whether he or she is a;general or limited partner.

 

Paper#58811 | Written in 18-Jul-2015

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