TJ_Comp 20_TB_Ch43

TJ_Comp 20_TB_Ch43 - Chapter 43LPs, LLCs, AND LLPs...

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Chapter 43—LPs, LLCs, AND LLPs TRUE/FALSE 1. Even limited partners are completely liable for debts of the business. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 2. A tax law ruling is responsible for the rapid growth of limited liability company statutes. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 3. While most states have adopted limited liability company statutes, few states have created statutes al- lowing limited liability partnerships to form. ANS: F TOP: AICAP BB-Legal MSC: AACSB Analytic 4. It is impossible to form a business in a manner that allows for single taxation and limited liability. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 5. Firms offering professional services (e.g., accounting firms) are prohibited from becoming limited li- ability partnerships. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 6. A limited partner can never lose money. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 7. Every limited partnership must have at least one general partner. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 8. Both general partnerships and limited partnerships are created only through the process of executing a certificate. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 9. If a limited partnership certificate is never filed, all partners are treated as limited partners. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 10. Limited partners may contribute cash or property as their capital contributions. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 11. Under the Revised Uniform Limited Partnership Act, limited partners may engage in certain “safe har- bor” activities without losing their protection from liability. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic
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12. In a limited partnership, general partners are not responsible for the debts of the firm. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 13. It is possible for a limited partner to be subject to the debts of the firm if the limited partner particip- ates in the control of the business. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 14. A limited partner may receive a share of the profits. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 15. A limited partner may never sue the business. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 16. A general partner within a limited partnership may be a corporation. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 17. The dissolution of a limited partnership is governed by unique rules quite different from those applic- able to the dissolution of a general partnership. ANS: F
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This note was uploaded on 02/22/2012 for the course BUS BUS212 taught by Professor Manney during the Spring '12 term at FSU.

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TJ_Comp 20_TB_Ch43 - Chapter 43LPs, LLCs, AND LLPs...

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