93%(30)28 out of 30 people found this document helpful
This preview shows page 11 - 14 out of 48 pages.
67. Roger is a limited partner in a business. To retain his limited liability protection, he must not: A. participate in the approval of new partners.B. participate in the removal of existing partners.C. consult or be paid by the business.D. assume management responsibilities.68. A general partnership may be formed by:
69. Sam and Dave are going to open a sporting goods store. They sign a written limited partnership agreement naming Dave as a limited partner and Sam as the general partner. Sam files a certificate of limited partnership with the state. Sam contributes $100,000 toward the start-up, while Dave contributes $200,000. They agree to split profits evenly because Sam will be working in the store and operating the day-to-day business. About a month after they open, the business is not doing well, so Dave starts becoming more involved. Soon he is requiring that Sam approve all purchases with him, and Dave is actively directing Jack, the sole other employee. One day, Geoff, a customer,is injured when a bowling ball falls off a shelf and shatters his foot. Geoff sues and is awarded a judgment of $1 million. 70. Which of the following does not require two or more principals? 71. How is the Revised Uniform Partnership Act similar to the Uniform Commercial Code
in terms of gap filling? 72. What process will the courts use to resolve a dispute between principals of a limited partnership in the absence of a written partnership agreement?
73. Thelma and Louise are roommates in college. Thelma loves to bake and makes
incredibly tasty chocolate chip cookies. Louise suggests that they sell the cookies aroundcampus and split the profits. They orally agree that Louise will advertise the cookies, provide decorative bags to put the cookies in, and be responsible for deliveries around campus while Thelma will obtain the ingredients and do all the baking. They intend the whole endeavor to be low-key and informal. Have Thelma and Louise created a business entity, and why is it important for them to fully understand their relationship? 74. You have been invited to become a member of a partnership. What are some of the considerations you need to assess in making a decision to become a general or limited partner? 75. Name the three specific events that are deemed events of dissociation by the Revised Uniform Partnership Act and are considered to be the most common. 76. You have just graduated and you want to start your own business. You have a degree in horticulture, so you have chosen to open a florist shop and plant nursery. What type ofbusiness entity will you choose? Explain its benefits and detriments in detail.