Question

5) Property purchased using partnership funds but acquired in the name of an individual partner is nonetheless the partnership's property. True or False

True

False

6) Once an LLC register's it's name in a particular state, that name is protected throughout the United States. True or False

True

False

7) An accountant faces potential liability under The Internal Revenue Code and securities laws, but not under the common law. True or False

True

False

8) When determining the negligence of an accountant, the standard of care required is "The Reasonable Person" standard. True or False

True

False

9) An accountant may avoid liability under the Securities Exchange Act if the accountant can prove a false or misleading statement was made in good faith. True or False

True

False

Answer 1

Ans-5- True

Reason-If the partnership purchases property with partnership assets, such property is presumed to be partnership property and is held in the partnership.Without the consent of all the partners individual partners may not sell the partnership property.

Ans-6- False

Reason-Once an LLC register,s its name in a particular state, that name is not protected throughout the united States.LLC are generally created pursuant to state law in order to protect the owners of businesses from the creditors of their businesses by creating a figurative wall between the owners and the business.

Ans-7- False

Reason- An accountant faces the potential liability under the common law because under the common law, accountant may be liable to clients for breach of contract,negligence or fraud.

Ans-8- True

Reason- When determining the neglignce of an accountant, the standard of care required is The Reasonable person because by neglecting the proper standard of care for a given situation an accountant may be found liable for any losses.

Ans-9- True

Reason- an accountant may avoid liability under the Securities Act if the accountant can prove a false or misleading statement was made in good faith because The Securities Exchange Act of 1934 relieves an accountant from liability if the accountant acted in 'good faith'.