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Which of the Following Is True of Profits and Losses

Question 54

Multiple Choice

Which of the following is true of profits and losses of an LLC whose operating agreement does not contain profit or loss sharing clauses?


A) A member who invests 10 percent capital must bear 10 percent of the losses.
B) A member who invests 30 percent of the capital receives 30 percent of the profit.
C) A member who invests 40 percent of the capital receives 20 percent share in profit.
D) All members receive equal shares in profits regardless of capital contributed.

Correct Answer:

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