Ch42-TB2-WBL-10O¦êv-F to Eric

Ch42-TB2-WBL-10O¦Ã&ordf...

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Chapter 42 Law for Small Businesses N.B.:   TYPE  indicates that a question is new, modified, or unchanged, as  follows. N A question  new  to this edition of the Test Bank. + A question  modified  from the previous edition of the Test Bank, = A question  included  in the previous edition of the Test Bank. TRUE/FALSE QUESTIONS 1. The chief factor in deciding whether to retain an attorney is the cost. ANSWER: F PAGE: 847 TYPE: N 2. Failure to comply with state incorporation requirements may subject the  owners to personal liability. ANSWER: T PAGE: 847 TYPE: N 3. A key consideration in starting up a business is whether the business form  chosen will limit personal liability for business obligations. ANSWER: T PAGE: 849 TYPE: = 4. In a limited liability partnership, the firm has limited liability for its debts. ANSWER: F PAGE: 849 TYPE: N 5. In a general partnership, the partners have no limited liability. 167
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168 TEST BANK 2—UNIT EIGHT: BUSINESS ORGANIZATIONS ANSWER: T PAGE: 849 TYPE: N
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CHAPTER 42: LAW FOR SMALL BUSINESS 169 6. A sole proprietorship’s profits are taxed before expenses are deducted, and  the owner’s profit is taxed on his or her personal return. ANSWER: F PAGE: 851 TYPE: = 7. Filing in a state office is  not  required to incorporate. ANSWER: F PAGE: 852 TYPE: N 8. A trademark can be similar to another’s distinctive or famous mark. ANSWER: F PAGE: 853 TYPE: + 9. Use of your name or a description of your product as a trademark provides  the strongest protection against infringement. ANSWER: F PAGE: 853 TYPE: = 10. To protect trade secrets, a company can require employees that have access  to the secrets to agree not to divulge the secrets. ANSWER: T PAGE: 855 TYPE: + 11. At common law, a company can sue a firm that misappropriates its trade  secrets. ANSWER: T PAGE: 855 TYPE: N 12. A public offering is an attempt by a business firm to raise a certain limited  amount of money from a certain limited number of investors. ANSWER: F PAGE: 857 TYPE: = 13. A shareholder agreement defines the owners’ rights and interests. ANSWER: T PAGE: 857 TYPE: = 14. A “take-along right” allows an investor to take specific items of corporate  property along with his or her purchase of an interest in the business. ANSWER: F PAGE: 857 TYPE: =
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170 TEST BANK 2—UNIT EIGHT: BUSINESS ORGANIZATIONS 15. Key-person insurance protects against the risk that a key employee may  resign. ANSWER: F PAGE: 857 TYPE: N 16. A contract should be in writing so that if a dispute arises, there will be  written evidence of the terms. ANSWER:
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This note was uploaded on 10/15/2010 for the course ACCT ACCT40 taught by Professor Birnbaum during the Fall '08 term at CUNY Brooklyn.

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Ch42-TB2-WBL-10O¦Ã&ordf...

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