Question 1

Dairy Products, Inc., and Eden Farms Corporation form a joint venture to make and test-market Frosty Ice Cream. A joint venture is usually formed for

Accepted Answer

Joint ventures are usually formed for a single transaction or project, as opposed to a continuous and ongoing business venture.

Question 2

Dana is a member of Earthground Coffee, LLC, a limited liability company. Dana is liable for Earthground's debts

Accepted Answer

As a member of a limited liability company, Dana's liability is limited to the extent of her investment in the firm. This is one of the primary benefits of forming an LLC - members are protected from personal liability for the company's debts and obligations beyond their investment in the company.

Question 3

Oil Reserves, Inc., and Petro Corporation form a joint venture to design and test petroleum storage facilities and equipment. When a dispute arises, Oil Reserves files a suit against Petro. The court is most likely to apply the same principles to this joint venture as it applies to

Accepted Answer

In a joint venture, the parties involved operate as partners and share profits, losses, and control over the venture. Therefore, the court is most likely to apply the same principles to this joint venture as it applies to partnerships.

Question 4

Phone Apps, LLC, is a limited liability company. Among its members, a dispute arises that the operating agreement does not cover. The dispute is governed by

Accepted Answer

When an LLC operating agreement does not cover a dispute among its members, the applicable state LLC statute will govern the resolution of the dispute. The state LLC statute provides default rules and provisions that govern the operation and management of LLCs.

Question 5

Orly's Adventure Travel and Paquito's Wild River Tours form a joint venture. Orly can participate in the venture's management to

Accepted Answer

In a joint venture, each party can participate in the venture's management to any extent agreed upon by the parties involved. There are no inherent legal restrictions limiting a party's involvement in management based on their liability or investment level.

Question 6

Greenway Corporation and Happy Trails, Inc., combine their efforts to build a network of biking and hiking trails along an unused railroad spur. Their form of business organization is

Accepted Answer

Greenway Corporation and Happy Trails, Inc. are combining their efforts for a specific project, which means they are forming a joint venture. A joint venture is a type of partnership where two or more businesses come together to collaborate on a specific project or goal. Unlike a partnership, a joint venture is a temporary arrangement and does not involve the creation of a new business entity.

Question 7

Tax Accounting, LLC, is a member-managed limited liability company. If the law in Tax Accounting's state is like the law in most states, unless the members have agreed otherwise, voting rights are apportioned according to

Accepted Answer

In most states, unless the LLC operating agreement provides otherwise, voting rights are apportioned in proportion to capital contributions made by each member.

Question 8

Rural Development Company and Suburban Real Estate Corporation form a joint stock company. A joint stock company can be formed for, at the most,

Accepted Answer

A joint stock company is a type of business organization that has a perpetual existence, which means that it can continue to exist beyond the lifetimes of its members. Therefore, option B is the correct answer. Option A, C, and D are not true because they limit the duration of the joint stock company in some way.

Question 9

Rogue Art Gallery and Sequoia Exhibitions form a joint venture. When a dispute arises, Rogue files a suit against Sequoia. The court is most likely to apply the same principles to this joint venture as it applies to

Accepted Answer

Joint ventures are typically similar to partnerships, where two or more parties come together to carry out a specific business activity for a limited amount of time. Therefore, the court is most likely to apply the same principles to this joint venture as it applies to partnerships. Business trusts, limited liability companies, and corporations are different types of business entities with distinct legal structures, so they would not be considered as applicable in this scenario.

Question 10

Leon, Michael, Nolan, and O'Neill join together to buy a professional basketball franchise. Their selected form of business organization is an investment group, which is also known as

Accepted Answer

An investment group that joins together to buy a professional basketball franchise is best described as a syndicate. A syndicate is a temporary association of individuals or firms formed to accomplish a specific task or transaction, such as investing in a business venture, like a professional sports franchise.

Question 11

Data Analytics, LLC, is a limited liability company. Unless the articles of organization specify otherwise, it will most likely be assumed that the firm is

Accepted Answer

Unless the articles of organization specify otherwise, it is assumed that a limited liability company is member-managed. This means that the members of the LLC have the authority to make decisions and manage the company's day-to-day operations.

Question 12

Lightning Corporation and Mind, Inc., two game creators, wish to combine their capabilities to make and market Nano, a special limited-edition game. The appropriate legal entity for this project is most likely

Accepted Answer

A joint venture is the most appropriate legal entity for this project as both Lightning Corporation and Mind, Inc. are combining their capabilities to create and market a limited-edition game. A joint venture is a temporary partnership for a specific project or undertaking, which allows the parties involved to share resources and expertise while remaining separate legal entities. This allows for a flexible and efficient structure for the collaboration between Lightning Corporation and Mind, Inc.

Question 13

Cliff is a member of Dental Clinic, LLC. Cliff can participate in the firm's management to

Accepted Answer

The answer of Cliff is a member of Dental Clinic,...

Question 14

Rollo is a member of Smooth Operators LLC, a limousine service. Rollo's relationship to Smooth Operators ends, but the firm continues to do business. This is​

Accepted Answer

Dissociation refers to the withdrawal of a partner from a partnership. In this scenario, Rollo is a partner or member of Smooth Operators LLC and his relationship with the firm ends, but the business itself continues to operate, meaning Rollo has dissociated from the partnership.

Question 15

Western Rodeo LLC is a limited liability company (LLC). Like other LLCs, for federal jurisdictional purposes, Western Rodeo is most likely a citizen of

Accepted Answer

The answer of Western Rodeo LLC is a limited liability...

Question 16

Custom Auto, LLC, is a limited liability company. Its members include Dennis and Emma. Like other LLCs with more than one member, unless indicated otherwise, the firm will automatically be taxed as

Accepted Answer

LLCs with more than one member are automatically taxed as a partnership, unless they elect to be taxed as a corporation.

Question 17

Start-Ups, LLC, is a limited liability company without a written operating agreement. Among the members, a dispute arises concerning the division of profits. Under most LLC statutes, the profits will be

Accepted Answer

The answer of Start-Ups, LLC, is a limited liability company...

Question 18

GMO Grain Corporation and Hybrid Yields, Inc., form a joint stock company. The ownership of a joint stock company is represented by

Accepted Answer

Ownership in a joint stock company is represented by shares of stock.

Question 19

Michel is a citizen of France. With respect to a limited liability company in the United States, Michel can

Accepted Answer

As a citizen of France, Michel can become a member of a limited liability company in the United States, just like any other foreign national. However, he will need to comply with any applicable laws and regulations regarding foreign investment or ownership in the specific state where the LLC is based.

Question 20

Global Shipping Corporation and Harbor Warehouse Company transfer their property to Investment Managers, Inc., which manages the property and distributes the profits to the beneficiaries. This form of business organization is

Accepted Answer

In a business trust, property is transferred to a trustee who manages it for the benefit of the beneficiaries. The trustee can be an individual or a corporation, and the beneficiaries may be individuals or other businesses. In this scenario, Global Shipping Corporation and Harbor Warehouse Company have transferred their property to Investment Managers, Inc. as the trustee, who will manage the property and distribute the profits to the beneficiaries. This fits the definition of a business trust. The other options presented (joint stock company, joint venture, and syndicate) do not accurately describe this form of organization.

Quiz 4: Limited Liability Companies and Special Business Forms

Dairy Products, Inc., and Eden Farms Corporation form a joint venture to make and test-market Frosty Ice Cream. A joint venture is usually formed for

Dana is a member of Earthground Coffee, LLC, a limited liability company. Dana is liable for Earthground's debts

Oil Reserves, Inc., and Petro Corporation form a joint venture to design and test petroleum storage facilities and equipment. When a dispute arises, Oil Reserves files a suit against Petro. The court is most likely to apply the same principles to this joint venture as it applies to

Phone Apps, LLC, is a limited liability company. Among its members, a dispute arises that the operating agreement does not cover. The dispute is governed by

Orly's Adventure Travel and Paquito's Wild River Tours form a joint venture. Orly can participate in the venture's management to

Greenway Corporation and Happy Trails, Inc., combine their efforts to build a network of biking and hiking trails along an unused railroad spur. Their form of business organization is

Tax Accounting, LLC, is a member-managed limited liability company. If the law in Tax Accounting's state is like the law in most states, unless the members have agreed otherwise, voting rights are apportioned according to

Rural Development Company and Suburban Real Estate Corporation form a joint stock company. A joint stock company can be formed for, at the most,

Rogue Art Gallery and Sequoia Exhibitions form a joint venture. When a dispute arises, Rogue files a suit against Sequoia. The court is most likely to apply the same principles to this joint venture as it applies to

Leon, Michael, Nolan, and O'Neill join together to buy a professional basketball franchise. Their selected form of business organization is an investment group, which is also known as

Data Analytics, LLC, is a limited liability company. Unless the articles of organization specify otherwise, it will most likely be assumed that the firm is

Lightning Corporation and Mind, Inc., two game creators, wish to combine their capabilities to make and market Nano, a special limited-edition game. The appropriate legal entity for this project is most likely

Cliff is a member of Dental Clinic, LLC. Cliff can participate in the firm's management to

Rollo is a member of Smooth Operators LLC, a limousine service. Rollo's relationship to Smooth Operators ends, but the firm continues to do business. This is

Western Rodeo LLC is a limited liability company (LLC) . Like other LLCs, for federal jurisdictional purposes, Western Rodeo is most likely a citizen of

Custom Auto, LLC, is a limited liability company. Its members include Dennis and Emma. Like other LLCs with more than one member, unless indicated otherwise, the firm will automatically be taxed as

Start-Ups, LLC, is a limited liability company without a written operating agreement. Among the members, a dispute arises concerning the division of profits. Under most LLC statutes, the profits will be

GMO Grain Corporation and Hybrid Yields, Inc., form a joint stock company. The ownership of a joint stock company is represented by

Michel is a citizen of France. With respect to a limited liability company in the United States, Michel can

Global Shipping Corporation and Harbor Warehouse Company transfer their property to Investment Managers, Inc., which manages the property and distributes the profits to the beneficiaries. This form of business organization is

Quiz 4: Limited Liability Companies and Special Business Forms

Dairy Products, Inc., and Eden Farms Corporation form a joint venture to make and test-market Frosty Ice Cream. A joint venture is usually formed for

Dana is a member of Earthground Coffee, LLC, a limited liability company. Dana is liable for Earthground's debts

Oil Reserves, Inc., and Petro Corporation form a joint venture to design and test petroleum storage facilities and equipment. When a dispute arises, Oil Reserves files a suit against Petro. The court is most likely to apply the same principles to this joint venture as it applies to

Phone Apps, LLC, is a limited liability company. Among its members, a dispute arises that the operating agreement does not cover. The dispute is governed by

Orly's Adventure Travel and Paquito's Wild River Tours form a joint venture. Orly can participate in the venture's management to

Greenway Corporation and Happy Trails, Inc., combine their efforts to build a network of biking and hiking trails along an unused railroad spur. Their form of business organization is

Tax Accounting, LLC, is a member-managed limited liability company. If the law in Tax Accounting's state is like the law in most states, unless the members have agreed otherwise, voting rights are apportioned according to

Rural Development Company and Suburban Real Estate Corporation form a joint stock company. A joint stock company can be formed for, at the most,

Rogue Art Gallery and Sequoia Exhibitions form a joint venture. When a dispute arises, Rogue files a suit against Sequoia. The court is most likely to apply the same principles to this joint venture as it applies to

Leon, Michael, Nolan, and O'Neill join together to buy a professional basketball franchise. Their selected form of business organization is an investment group, which is also known as

Data Analytics, LLC, is a limited liability company. Unless the articles of organization specify otherwise, it will most likely be assumed that the firm is

Lightning Corporation and Mind, Inc., two game creators, wish to combine their capabilities to make and market Nano, a special limited-edition game. The appropriate legal entity for this project is most likely

Cliff is a member of Dental Clinic, LLC. Cliff can participate in the firm's management to

Rollo is a member of Smooth Operators LLC, a limousine service. Rollo's relationship to Smooth Operators ends, but the firm continues to do business. This is​

Western Rodeo LLC is a limited liability company (LLC) . Like other LLCs, for federal jurisdictional purposes, Western Rodeo is most likely a citizen of

Custom Auto, LLC, is a limited liability company. Its members include Dennis and Emma. Like other LLCs with more than one member, unless indicated otherwise, the firm will automatically be taxed as

Start-Ups, LLC, is a limited liability company without a written operating agreement. Among the members, a dispute arises concerning the division of profits. Under most LLC statutes, the profits will be

GMO Grain Corporation and Hybrid Yields, Inc., form a joint stock company. The ownership of a joint stock company is represented by

Michel is a citizen of France. With respect to a limited liability company in the United States, Michel can

Global Shipping Corporation and Harbor Warehouse Company transfer their property to Investment Managers, Inc., which manages the property and distributes the profits to the beneficiaries. This form of business organization is

Rollo is a member of Smooth Operators LLC, a limousine service. Rollo's relationship to Smooth Operators ends, but the firm continues to do business. This is