Ch.38 Worksheets - Chapter 38 Worksheets Worksheet – The...

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Chapter 38 Worksheets Worksheet – The Limited Liability Company Its Management and Operation 1. A limited liability company (LLC) combines the tax characteristics of: D. A partnership with the liability of a corporation. 2. Members - The term used to designate a person who has an ownership interest in a limited liability company. Articles of organization – The document filed with a designated state official by which a limited liability company is formed. Limited liability Company - A hybrid form of business enterprise that offers the limited liability of the corporation but the tax advantages of a partnership. 3. The Uniform Limited Liability Company Act (ULLCA) has now been adopted by almost all of the states. FALSE 4. One of the great benefits of LLCs, and one that helps promote investment, is the fact that: Foreign investors are allowed to become LLC members. In an LLC, a member is someone who: has an ownership interest in an LLC and limited liability for LLC debts. When a group of members joint to form an LLC, the name of the organization must: include the words “limited liability company” or the letters LLC. 5. LLCs are legal entitles apart from their owners and as such can sue or be sued, enter into contracts, and hold title to property. TRUE 6. Which of the following is NOT typically a part of the contents of an LLC's articles of organization filed with the central state agency? The hours of operation of the business. Marsden wants to start a new company with different partners to explore oil-drilling opportunities in several states. When discussing the LLC form, Marsden's attorney mentions that one of the biggest disadvantages of the LLC form is that: There is no uniform law governing LLCs in the United States. 7. Two options for management of an LLC: Member-managed or Manager-managed 8. Xavier consults with his attorney about the management of his LLC. He has chosen the manager- managed LLC form of management in which: B. the managers may be members, nonmembers, or a combination of both. 9. Operating Agreements Typically Contain Provisions Relating to the Following Areas: A. Management and how future managers will be chosen or removed. B. How profits will be divided. C. How membership interests may be transferred. D. Whether the dissociation of a member, such as by death or departure will trigger dissolution of the LLC. E. Whether formal members’ meetings will be held.
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