Question 1

General partnerships are not created by filing a form with a government agency.

Accepted Answer

The partnership is created when the parties agree to act as a partnership or their actions create a partnership by implication.

Question 2

The Revised Uniform Partnership Act was enacted by Congress to make partnership law more consistent and standardized throughout the United States.

Accepted Answer

RUPA was drafted by the National Conference of Commissioners on Uniform State Laws.

Question 3

Even if the parties have no intent to form or operate as a partnership, their conduct may result in the law recognizing them as partners.

Accepted Answer

A partnership may be implied from the parties conduct even if no intent exists.

Question 4

A _____________ is a business entity that has a proven track record of success and sells the right to operate the business and use the business's trade secrets, trademarks, products, and so on.

Accepted Answer

The answer of A _____________ is a business entity that...

Question 5

A business existing in or by right of law is considered a ________ entity.

Accepted Answer

The answer of A business existing in or by right...

Question 6

Capitalization refers to how the business will fund its operations.

Accepted Answer

Capitalization has to do with how money will be raised and from whom money will be raised to fund the various parts of the business.

Question 7

Limited partnerships are required to file a(an) ________ return with the IRS each year.

Accepted Answer

The answer of Limited partnerships are required to file a(an)...

Question 8

Wayne Lewis wants to start a sole proprietorship named Lewis Plumbing Services. Because it will be a sole proprietorship, Wayne has no filing requirements other than obtaining the appropriate business license from the local and state government where the business will be located.

Accepted Answer

At a minimum, he will also need to fill out and file a DBA certificate naming himself as principal.

Question 9

Business entities are sometimes referred to as business _______.

Accepted Answer

The answer of Business entities are sometimes referred to as...

Question 10

A general partner who rightfully dissociates from a partnership remains liable for predissociation debts of the partnership.

Accepted Answer

A general partner will not be liable for debts incurred after dissociation but remains liable for predissociation debts.

Question 11

Tabletop, LP, is registered in Nebraska but operates the business in the state of Iowa. Nebraska will require that an in-state address and a ________ be identified to receive mail and accept legal documents.

Accepted Answer

The answer of Tabletop, LP, is registered in Nebraska but...

Question 12

In all forms of business entities, the entity itself pays taxes on money earned by or through the entity.

Accepted Answer

Some business entities do not pay taxes; however, the taxes are passed through to the owner or owners.

Question 13

Business owners are also known as _______.

Accepted Answer

The answer of Business owners are also known as _______....

Question 14

One disadvantage of a sole proprietorship business entity is that it is restricted to the principal and the principal's immediate family in terms of number of employees who may work for the business.

Accepted Answer

There is no restriction on the number of employees a sole proprietorship may hire.

Question 15

If two people identify themselves as general partners and create a written partnership agreement, the law is obligated to recognize their business entity as a general partnership.

Accepted Answer

Simply calling themselves general partners does not create a general partnership if they do not act and treat each other as general partners, regardless of whether an agreement exists or not.

Question 16

General partnerships are pass-through entities regarding taxation; however, limited partnerships are not pass-through entities for taxes.

Accepted Answer

Both general and limited partnerships are pass-through entities for tax purposes.

Question 17

The duty of a partner to act in the best interests of the partnership is called a ________ duty.

Accepted Answer

The answer of The duty of a partner to act...

Question 18

Federal laws regulating the selling of equity in limited partnerships through broker-dealer contracts are known as ________ laws.

Accepted Answer

The answer of Federal laws regulating the selling of equity...

Question 19

Under the Revised Uniform Partnership Act, the act of leaving a partnership and ceasing to be a principal is called _______.

Accepted Answer

The answer of Under the Revised Uniform Partnership Act, the...

Question 20

Under the Revised Uniform Limited Partnership Act, the act of leaving a limited partnership and ceasing to be a principal is called _______.

Accepted Answer

The answer of Under the Revised Uniform Limited Partnership Act,...

Quiz 14: Choice of Business Entity, Sole Proprietorships, and Partnerships