Deck 5: Limited Liability Partnerships and Limited Liability Limited Partnerships

Question 1

Unlike the general partnership, in which all partners have personal liability for the debts and obligations of the partnership,

A) the limited partnership offers limited per- sonal liability for all partners.
B) the limited liability partnership offers limited personal liability for all partners.
C) the limited liability limited partnership offers limited personal liability for all part- ners.
D) both the limited liability partnership and the limited liability limited partnership offer some degree of limited personal liability for all partners.

Answer 1

D

Question 2

Partners of a general partnership typically have joint and several liability for the debts and obligations of the partnership.

Answer 2

True

Question 3

Some states require limited liability partner- ships to carry liability insurance to protect the partners from bad investments.

Answer 3

False

Question 4

In states that have adopted full shield statutes, partners may be held personally liable for

A) any debts and obligations of the partner- ship.
B) partnership obligations incurred due to their own wrongdoing.
C) no debts and obligations incurred by the partnership.
D) partnership debts and obligations incurred due to the wrongdoing of other partners.

Question 5

The proper documentation must be filed with the secretary of state to elect limited liability limited partnership status.

Question 6

In states that have adopted partial shield stat- utes, partners may not be held personally liable for

A) any debts and obligations of the partner- ship.
B) partnership obligations incurred due to their own wrongdoing.
C)
C) partnership debts and obligations incurred due to the wrongdoing of other partners.
D) both B and

Question 7

A carefully drafted partnership agreement can be important to the success of the limited liability partnership.

Question 8

The number of limited liability partnerships in the United States has

A) decreased since 1998.
B) grown at an impressive rate.
C) surpassed the number of corporations.
D) remained about the same since 1998.

Question 9

Foreign limited liability partnerships generally do not need to qualify to do business in states where they do business unless they plan to incorporate.

Question 10

Partners of a limited liability partnership may be held personally responsible for partnership obligations incurred due to their own wrong doing.

Question 11

A disadvantage of doing a business as a limited liability limited partnership formed under the Limited Partnership Act of 2001 is that

A) general partners do not have limited lia- bility for the debts and obligations of the partnership.
B) the limited liability limited partnership is not formed until the proper documentation is filed with the secretary of state.
C) limited partners may not participate in the management of the partnership business.
D) the limited liability limited partnership is subject to double taxation.

Question 12

State partnership laws generally have provisions

A) requiring a vote of all partners to elect limited liability partnership status.
B) requiring the filing of a statement of quali- fication to elect limited liability partnership status.
C) establishing annual reporting requirements for limited liability partnerships.
D) providing for all of the above.

Question 13

The Limited Partnership Act of 2001

A) assumes that all limited partnerships are limited liability limited partnerships.
B) does not permit limited liability limited partnerships.
C) provides for an easy election to form either a limited partnership or a limited liability limited partnership.
D) does not provide for the limited liability of general partners.

Question 14

In most states, the same number of partners required to approve an amendment to the partnership agreement must vote to approve the limited liability partnership election.

Question 15

In most states, limited liability partnerships are governed by

A) special provisions within the state's uni- form partnership act.
B) the state's limited liability partnership act.
C) special provisions within the state's busi- ness corporation act.
D) special rules put forth by the secretary of state.

Question 16

Several states have adopted limited liability limited partnership legislation to offer limited liability status to both general and limited partners.

Question 17

Limited liability partnerships are formed when the partners sign a limited liability agreement.

Question 18

The statement of qualification to elect limited liability partnership status generally does not include

A) the name of the limited liability partnership.
B) the street address of the partnership within the state where the statement is filed.
C) a statement that the partnership elects to be a limited liability partnership.
D) a statement indicating which partners are general partners and which partners are limited partners.

Question 19

As of late 2011,

A) several states had adopted statutes approv- ing the formation of limited liability limited partnerships.
B) most states had adopted the Uniform Lim- ited Liability Limited Partnership Act.
C) there was little uniformity among the states with regard to limited liability limited part- nership law.
D) both A and C are true.

Question 20

No partner of a limited liability partnership ever has any personal liability for the debts and obligations of the partnership.