Business Organizations

  1. Business owned and operated by one person
    Sole Proprietorship
  2. Business co-owned by two or more persons
    General Partnership
  3. Business created under a state statute in which some partners have limited liability
    Limited Partnership
  4. Business providing limited liability and pass-through tax status for its members
    Limited Liability Company
  5. Legal entity existing under the authority of the state legislature
    Business Corporation
  6. Corporation formed by professionals, such as doctors, lawyers, accountants, and engineers
    Professional Corporation
  7. Corporation that passes through all income to its shareholders, who pay tax on income received
    S Corporation
  8. Small corporation whose shareholders are active in managing the business and that operates informally
    Close Corporation
  9. One who acts for or represents another
  10. The person for whom an agent acts
  11. Duties owed by an agent
    Performance, Notification, Loyalty, Accounting of Profits
  12. Duties owed by principle
    Compensation, Reimbursement and Indemnification, Cooperation
  13. A business owned and operated by one person and is limited by the life of it's owner
    Sole Proprietorship
  14. Liability extended beyond what is invested in a business to an individual's personal assets
    Personal Liability
  15. Money used to form and operate a business or other venture
  16. a name that must be registered with state or local officials because it does not disclose the surname of the business owner.
    Fictitious name
  17. a voluntary association of two or more persons who agree to carry on business together for profit.
    General Partnership.
  18. Model for partnership legislation in about three fourths of the states.
  19. Business entity created in accord with state statutes that provides limited liability to some of its members
    Limited Partnerships
  20. A member of a limited partnership who does not participate in managing the business and whose liability is limited to amount invested in the business.
    Limited Partner
  21. Member in a limited partnership who manages and controls the business and has unlimited personal liability
    General Partner
  22. Investment vehicle entered into by family members to achieve estate and tax planning benefits.
    Family Limited Partnership.
  23. Entity providing full protection for its members from all personal liability, whether arising in tort or contract; must comply with statutes.
    Limited Liability Companies
  24. A partnership formed to carry out a single enterprise rather than an ongoing business
    Joint Venture
  25. What are the advantages of a corporation
    Limited liability, Corporate deductions, Continuity of existence, Transferability of share ownership.
  26. One involved in forming a corporation and organizing its structure.
  27. The combination of equity and debt securities.
    Capital structure
  28. a share, participation, or other interest in property or an enterprise of the issuer or an obligation of the issuer
  29. A security representing ownership interest in an enterprise
    Equity Security
  30. Capital received by a corporation in return for issuance of stock
    Equity Capital
  31. a security representing an obligation of the corporate issuer (often called a bond or a loan) and require a regular payment (including interest with the intent to pay off the loan)
    Debt Security
  32. Money received by a corporation in return for issuing debt
    Debt Capital
  33. One to whom a debt is owed by a corporation (a secured creditor)
  34. An unsecured corporate obligation
  35. Trading on equity (when the total investment yields a higher rate of return than the cost of borrowing money)
  36. A distribution of corporate profits
  37. Ordinary stock of a corporation having no special privileges.
    Common stock/shares
  38. Stock in a corporation that carries certain rights and privileges, generally non-voting shares.
    Preferred Stock
  39. Shares of a given class that may be converted into shares of another class on some predetermined ration in the Articles of Incorporation
    Convertable Shares
  40. The dollar amount stated as the value of each share
    Par Value
  41. The number of authorized shares held by shareholders
    Outstanding shares
  42. Stock issued for less tan the full value set by the board
    Watered Stock
  43. Payments to shareholders that are not a sharing of profits
  44. Distribution of a corporation's profits to shareholders.
  45. A division of outstanding shares
  46. State Laws regulating issuance of securities within a state
    Blue Sky Laws
  47. Corporation doing business in the state in which it was formed
    Domestic Corporation
  48. Corporation doing business in a state other than the state in which it was formed
    Foreign Corporation
  49. Termination of the legal status of an entity
  50. Process of collection assets, paying debts, and distributing remains to business owners
  51. Corporation whose shares are held by a small group that is active in managing the corporation
    Close Corporation
  52. Corporation formed for a purpose other than to earn profit
    Non-profit Corporation
  53. A corporation that forms another
  54. A corporation formed by another
  55. The incorporation of the practice of a professional, including a doctor or lawyer.
    Professional Corporation
  56. T/F - Agency relationships can only be created by written agreement
  57. T/F - A principle may later ratify an agent's acts even if the act is unauthorized by the agency relationship.
  58. T/F - If parties have not specified a termination date for an agency relationship, the agency relationship will expire after a reasonable amount of time.
  59. T/F - Sole proprietorship's have many regulatory formalities for their creation
  60. T/F - Shareholders of a corporation retain all business profits and suffer all business losses by themselves.
  61. T/F - All sole proprietorship's must file fictitious business name statements.
  62. T/F - General partnerships can be formed only by written agreement.
  63. T/F - You can create partnership for a non-profit business.
  64. T/F - Partners may assign their rights to profits from a general partnership and assign their management roles.
  65. T/F - Partners do not ordinarily receive compensation for performing services for their general partnerships; they generally share in profits arising from the general partnership.
  66. T/F - In general, a partnership agreement may provide for nearly any scheme of division of profits and losses that partners in a general partnership desire.
  67. T/F - General partnerships do not file federal income tax returns because the entities do not pay federal taxes.
  68. T/F - Members of a partnership may form a contract among themselves regarding the operations of the partnership
  69. T/F - A general partner in a limited partnership has the same status, duties, and rights as a general partner in a general partnership.
  70. T/F - Generally, limited partners can freely transfer their interests to others without causing a dissolution of the limited partnership.
  71. T/F - To form a limited partnership, a limited partnership certificate must be filed with the Secretary of State for a particular jurisdiction.
  72. T/F - Under the RULPA, a limited partnership agreement may be written or oral.
  73. T/F - Partnerships are generally taxed the same (pass-through of taxes).
  74. Limited partnership are creations of
  75. T/F - LLPs may be formed only for the practice of professions, such as medicine or law.
  76. T/F - LLPs are recognized only in 48 states
  77. T/F - An LLP formed in one state can operate as an LLP in another.
  78. T/F - An LLP agreement may be oral or in writing.
  79. T/F - The taxation of an LLP is the same as that for a general partnership.
  80. T/F - Members of an LLC enjoy pass-through taxation and limited liability.
  81. T/F - Nearly all states allow one-person LLCs.
  82. T/F - A non-profit organization may operate as an LLC.
  83. T/F - A manager of an LLC need not be a member of the LLC.
  84. The participants in an LLC are called
  85. T/F - Joint stock companies are similar to LLPs and LLCs because they afford the best features of partnerships and of corporations.
  86. T/F - The formation of a corporation is similar to a general partnership.
  87. T/F - Shareholders, Directors, and Officers manage the corporation.
  88. T/F - A corporation's promoters are not insulated from personal liability for obligations they undertake prior to formation of a corporation.
  89. T/F - Corporations are subject to regulation and taxation only in the state in which they incorporate (and not in other states in which they conduct business).
  90. T/F - Bylaws are filed with the secretary of state of a corporation's state of incorporation.
  91. T/F - The only way for corporations to raise money from debt equity.
  92. T/F - Authorized shares are shares that have been issued to investors.
  93. T/F - Debt securities show ownership interest in a corporation.
  94. T/F - Voting Agreements are when shareholders may enter into binding agreements with each other by which they specify in writing in advance how they will vote.
  95. T/F - A written consent allows shareholders to take action without holding a formal shareholders' meeting if they unanimously consent in writing to the action to be taken.
  96. T/F - Dividends are allocated to shareholders in direct proportion to their respective ownership interest in the corporation.
  97. T/F - Directors may have personal liability for declaring and paying dividends when the corporation does not have sufficient funds to do so.
  98. T/F - A stock split has the same effect as a share dividend.
  99. T/F - All amendments to the articles of incorporation require shareholder approval.
  100. T/F - The decision to amend articles of incorporation typically begins with the board of directors.
  101. T/F - Amended bylaws are kept at the corporate offices and filed with the secretary of state.
  102. T/F - When a corporation purchases another corporation's stock, it need not seek its shareholder approval to make the acquisition.
  103. T/F - A corporation incorporated in Delaware can change its state of incorporation to New York.
  104. Stock issued for less than par value is known as watered stock. T/F
  105. Preemptive rights are exercised to protect a shareholder's proportionate interest in the corporation. T/F
  106. Redemption of stock is

    C. giving up the stock in exchange for corporate assets.
  107. Short-term share options are called stock rights. T/F
  108. Insulating owners from a defectively formed corporation is known as the doctrine to corporation by estoppel. T/F
  109. Combining debt securities and equity securities of a corporation is regarded as

    D. capital structures
  110. A dissenting vote recorded in the minutes eliminates the dissenting director's potential personal liability for the action taken. T/F
  111. A de jure corporation is a corporation that has met all statutory requirements for its creation. T/F
  112. A(n) ________is a corporate debt evidenced by a certificate of some type.

    A. debenture
Card Set
Business Organizations
Business Organizations