Business Law Past Paper PDF

    1. Andrew is a limited partner in a limited partnership and he decided to bequeath his 10% interest in the partnership to his daughter Bella in his will. Andrew recently passed away which means:...

    1. Andrew is a limited partner in a limited partnership and he decided to bequeath his 10% interest in the partnership to his daughter Bella in his will. Andrew recently passed away which means: a. Bella is now a partner in the LP. b. Bella gets the same share of profits that Andrew would have gotten. c. Bella gets to make 10 % of the management decisions for the LP. d. All of the above e. None of the above 2. Jafar, Aladdin, and Jasmine are best friends and they want to go into business. They all want to be able to make management decisions but none of them want to have personal liability for the business's debts. They also want pass-through taxation. Which business structure should they pursue? f. Partnership g. Limited Partnership h. LLC i. Corporation 3. Leonard is a general partner in an LP that makes women's clothes. The LP created an LPA when it was formed. Recently, Leonard started another company that sells men's clothes. Leonard's partners bring suit claiming that he has breached his fiduciary duty. How should the court decide this suit? j. The court will automatically find that Leonard breached his fiduciary duty by opening a clothing company when he is already a partner in a clothing company. k. The court will look to the LPA to see if the LPA restricted or expanded Leonard's fiduciary duties. l. The court will look to laws of the state in which the LP is registered m. None of the above Three friends, Larry, Moe, and Curly decided to incorporate a business for selling shoes that they will call LMC. They chose Delaware as their state of incorporation and Moe filed the Articles of Incorporation there. While they were waiting to receive the approval of their filing, Larry leased a storefront for the business in the business name, LMC. The three friends each put in \$50k of their own money into the business. They then also took out a loan of \$500,000 dollars under the business name. The three then proceeded to open a company credit card and buy about \$750K in equipment, The three also spent another \$300k to buy "company cars" that they also used for their personal errands. Unfortunately, after doing all this, they found out that Moe had not properly filed the paperwork for incorporation. Curly is upset, he thinks Moe is careless, and Curly wants to pull out of the business venture. He tells Larry and Moe that they must pay him back the \$50K he put into the business, he also returns the company car he has been driving. 4. The corporation is undercapitalized. n. True o. False 5. Curly must be paid back his \$50K. p. True q. False 6. If the business fails, how would creditors get paid: r. With any remaining profits of the corporation s. With any of the assets the corporation still has t. By piercing the corporate veil and making the three friends use their personal money to pay back creditors u. All of the above v. None of the above 7. The only way that the recording deal would be upheld is if: w. Debra is found to be Dustin's attorney x. Debra is found to be Dustin's agent y. Debra is found to be Dustin's agent and the recording deal was with within the scope of her authority as Dustin's agent. z. All of the above a. None of the above 8. Assuming the recording deal is not upheld: b. The recording company could sue Dustin for breach of contract. c. The recording company can sue Debra for any losses they incurred. d. Both of the above e. None of the above 9. In a partnership: f. None of the partners have limited liability. g. There is double-taxation. h. There is limited liability for at least one partner. i. None of the above 10. In a limited liability company j. All of the owners have limited liability k. All of the owners could have management control. l. There is pass-through taxation. m. All of the above n. None of the above