BUL 3310 Exam 4- Bailey Graded A+

BUL 3310 Exam 4- Bailey Graded A+ Partnerships typically buy life insurance policies on each partner in order to fund the required purchase of the partner's interest in the partnership when the partner dies T/F True Subchapter S corporation will avoid double taxation if which of the following applies? A. All the shareholders agree to be taxed as in a partnership B. The corporation files Articles of Partnership in the state where it has its principal place of business C. The corporation has no retained earnings D. All of the above A. All of the shareholders agree to be taxed as in a partnership Which of the following statements about the rights and duties of doctors who practice medicine in a professional corporation is true? A. Doctors have no personal liability for medical malpractice suits. B. Because they are also owners of the corporation, doctors have no protection from discrimination based on age. C. The professional corporation can have no more than ten owner-employee doctors. D. They are eligible to participate in tax advantaged pension plans. D. They are eligible to participate in tax advantaged pension plans What is the limit of shareholders in subchapter S corporations? A. 10 B. 35 C. 100 D. There is no limit B. 35 Which of the following statements about LLC's is false? A. LLC's are a relatively new form of business organization. B. There is an extensive body of law based on court decisions governing LLC's. C. Shareholders have no personal liability for the debts of the LLC. D. The LLC is not a taxable entity B. There is an extensive body of law based on court decisions governing LLC's States give corporations many rights, among them is the right to sue and the right to own property in the corporation's name. What do such legal rights collectively constitute for a corporation? A. Goodwill B. Legal capacity C. Business identity D. Competitive advantage B. Legal capacity The owner of a limited liability company (LLC) has unlimited personal liability for the debts of the LLC T/F False The provisions of the law AND the partnership agreement govern the operations of the partnership T/F True Sharing in net profits is not prima facie evidence that a partnership exists if the profits were paid by the partnership ... A. As rent B. For wages C. As an annuity to the spouse of a deceased partner D. All of the above D. All of the above Frank is a seller of imported pottery. To induce a new wholesaler to sell him goods on credit, Frank and his brother Ed told the wholesaler that Ed was a partner in the business. In fact, Ed had no partnership