AGEC 3713 EXAM QUESTIONS AND
CORRECT ANSWERS ALREADY
PASSED
What are the ways you can "pierce the corporate veil?" - Answer--Intermingling assets
-Underfunding the entity
-Failing to follow corporate formalities
-Failing to pay taxes or entity filing/renewal fees.
Why don't credit card companies want you to go bankrupt? - Answer-Because they
have to pay for it
What is the order in which creditors get paid (i.e. secured vs. unsecured, secured vs.
secured, etc.) - Answer-Secured vs. Unsecured= Secured wins
Secured (perfected) vs. Secured (unperfected)= Perfected wins.
Which chapter of the Bankruptcy Code applies only to farmers? - Answer-Chapter 12
What are the eligibility requirements for Chapter 12 of the Bankruptcy Code? - Answer--
Individual must be engaged in a farming operation.
-Total debts must not exceed $4,153,150
-At least 50% of the total debts that are fixed in amount must be related to the farming
operation
-More than 50% of the gross income of the individual or the husband and wife for the
preceding tax year must have come form the farming operation
-The farmer must have some form of "regular annual income."
What are the types of brokerage agreements? - Answer-Exclusively-agency listing
Exclusively right to sell
Multiple listing
Which ones involve a broker and who gets the commission in the sale? - Answer-
Exclusively-agency listing and exclusive right to sell involve a broker. In exclusively-
agency listing: only one broker is authorized to sell the property, and gets the
commission. (However, the seller can still sell the property and if so, no commission is
paid). In exclusively right to sell: only the broker is authorized to sell the property, and is
entitled to commission no matter who sells the property.
, What provisions should be included in a land sale contract, ESPECIALLY "Ferrell's Top
Four? - Answer-1) A clear description of the parties
2) The purchase price and how it is to be paid
3) A complete and accurate legal description
4) Signature of the parties
5) The date the buyer will take possession
6) A statement regarding any rights of interests reserved by the seller
7) Agreement by the seller to furnish a commitment and/or an abstract and cure any
defects
8) Description of how taxes, assessments, and insurance are to be apportioned
What are the purposes of bankruptcy? - Answer-CREDITORS:
-Can at least get something, and forces the debtor to deal with all the creditors in an
open manner.
DEBTOR:
-Creates an automatic stop to debt efforts.
-Allows for debts dealt with in the proceeding to be discharged (But note: no force can
destroy child support or student loans!!)
-Beats the legal battles of default
What property is "exempt" from collection in a judgement on debts or in bankruptcy? -
Answer--For an urban parcel, homestead exemption allows you to keep your home and
the land it sits on (up to 1 acre), unlimited in value.
-For rural parcel, homestead exemption allows you to keep your home and the land it
sits on (up to 160 acres).
-But if you have given a mortgage in the property, your homestead is not exempt.
Easement - Answer-right to make limited use, but not possess, the right of another.
License - Answer-A revocable right to make limited use of another's property
Profit - Answer-The right to enter someone's else's land and take something with you
when you go
How is an easement created? - Answer-Operation of law.
Prescription: the law favors making land accessible and susceptible to economic
activity, so it will commonly grant access to land locked parcels.
Adverse possession: party uses an easement for so long that it is recognized as a legal
interest.
How is a license created? - Answer-Express: you expressly grant the license. (License
can be created orally)
Implied: you tried to create an easement but didn't get it in writing.
CORRECT ANSWERS ALREADY
PASSED
What are the ways you can "pierce the corporate veil?" - Answer--Intermingling assets
-Underfunding the entity
-Failing to follow corporate formalities
-Failing to pay taxes or entity filing/renewal fees.
Why don't credit card companies want you to go bankrupt? - Answer-Because they
have to pay for it
What is the order in which creditors get paid (i.e. secured vs. unsecured, secured vs.
secured, etc.) - Answer-Secured vs. Unsecured= Secured wins
Secured (perfected) vs. Secured (unperfected)= Perfected wins.
Which chapter of the Bankruptcy Code applies only to farmers? - Answer-Chapter 12
What are the eligibility requirements for Chapter 12 of the Bankruptcy Code? - Answer--
Individual must be engaged in a farming operation.
-Total debts must not exceed $4,153,150
-At least 50% of the total debts that are fixed in amount must be related to the farming
operation
-More than 50% of the gross income of the individual or the husband and wife for the
preceding tax year must have come form the farming operation
-The farmer must have some form of "regular annual income."
What are the types of brokerage agreements? - Answer-Exclusively-agency listing
Exclusively right to sell
Multiple listing
Which ones involve a broker and who gets the commission in the sale? - Answer-
Exclusively-agency listing and exclusive right to sell involve a broker. In exclusively-
agency listing: only one broker is authorized to sell the property, and gets the
commission. (However, the seller can still sell the property and if so, no commission is
paid). In exclusively right to sell: only the broker is authorized to sell the property, and is
entitled to commission no matter who sells the property.
, What provisions should be included in a land sale contract, ESPECIALLY "Ferrell's Top
Four? - Answer-1) A clear description of the parties
2) The purchase price and how it is to be paid
3) A complete and accurate legal description
4) Signature of the parties
5) The date the buyer will take possession
6) A statement regarding any rights of interests reserved by the seller
7) Agreement by the seller to furnish a commitment and/or an abstract and cure any
defects
8) Description of how taxes, assessments, and insurance are to be apportioned
What are the purposes of bankruptcy? - Answer-CREDITORS:
-Can at least get something, and forces the debtor to deal with all the creditors in an
open manner.
DEBTOR:
-Creates an automatic stop to debt efforts.
-Allows for debts dealt with in the proceeding to be discharged (But note: no force can
destroy child support or student loans!!)
-Beats the legal battles of default
What property is "exempt" from collection in a judgement on debts or in bankruptcy? -
Answer--For an urban parcel, homestead exemption allows you to keep your home and
the land it sits on (up to 1 acre), unlimited in value.
-For rural parcel, homestead exemption allows you to keep your home and the land it
sits on (up to 160 acres).
-But if you have given a mortgage in the property, your homestead is not exempt.
Easement - Answer-right to make limited use, but not possess, the right of another.
License - Answer-A revocable right to make limited use of another's property
Profit - Answer-The right to enter someone's else's land and take something with you
when you go
How is an easement created? - Answer-Operation of law.
Prescription: the law favors making land accessible and susceptible to economic
activity, so it will commonly grant access to land locked parcels.
Adverse possession: party uses an easement for so long that it is recognized as a legal
interest.
How is a license created? - Answer-Express: you expressly grant the license. (License
can be created orally)
Implied: you tried to create an easement but didn't get it in writing.
