Question

16. Which of the following statements about partnerships are true?

	A.	Partnerships afford their owners a liability shield against claims from third parties.
	B.	For tax purposes, partnerships are pass through entities.
	C.	Absent an agreement to the contrary partnerships do not survive the death of one of the partners.
	D.	Partnerships are relatively easy to form.

17.The Securities and Exchange Commission holds primary responsibility for which of the following. Check all that apply.

	A.	Determining the offering price for shares in an initial public offering of stock.
	B.	Enforcing federal securities laws.
	C.	Enforcing state securities laws.
	D.	Proposing federal securities rules .
	E.	Regulating the securities industry , the nation's stock and options exchanges, and other activities and organizations, including electronic securities markets in the United States.
	F.	Counseling investors as to the desirability of public stock offerings.

18. Select the best phrase to complete the following:

Delaware's Chancery Court

	A.	has exclusive jurisdiction to hear corporate law questions in the United States.
	B.	is one of the primary disadvantages of incorporating in Delaware.
	C.	is a specialized business court with judges who are expert in corporate law.
	D.	has jurisdiction over federal bankruptcy matters.

19. Which of the following factors will a court consider in determining whether a partnership exists?

	A.	The qualifications of the parties to conduct the business of the partnership.
	B.	Whether the parties intend to make a profit.
	C.	Whether the parties are involved in the management of the business.
	D.	Whether there are independent outside investors in the business.
	E.	How the parties divide profits and losses deriving from the business.
	F.	Whether the business has actually earned a profit.
	G.	Whether the business conducts activities in more than one jurisdiction.
	H.	Whether there is a partnership agreement.

20.Select the statement concerning limited liability companies that is most complete and accurate.

	A.	Limited liability companies are typically taxed at the entity level.
	B.	Limited liability companies offer liability protection for owners and managers from debts of the company.
	C.	Limited liability companies offer liability protection for owners and managers from debts of the company. Limited liability companies also offer pass through tax treatment.
	D.	Limited liability companies offer liability protection for owners but not for managers from debts of the company.

Answer 1

Answer- 16)

D) statement is true about the partnership as, Partnership is easy to form because there is minimum two person needed to start the business with the same goals i.e profit. And then they form an agreement, which gives business it's legal identity.

Further they just have to discuss about some important subjects like-

• How the business will be financed, who will be financed.

• Who will do which or what work.

• What happens, if the partners die.

• Or about the dissolution of partnership.

Answer-17)

The Securities and Exchange commission's main objective is to protect the interest of investors from the indulge activities.

The primary responsibility of SECURITIES AND EXCHANGE COMMISSIONER is e) that regulating the securities industry, the nation's stock and options exchanges and other activities and organisations, including electronic Securities markets in United States as it includes the basic purpose is regulating the securities industry and with this primary responsibility, it also Enforce federal securities laws and propose federal securities rules and determine the offering price for shares in an initail public offering of stock and Counselling investors as to the desirability of public stock offering . This all are the primary responsibility and important responsibility of SECURITIES AND EXCHANGE COMMISSION.

Answer-18)

The best phrase to complete the Delaware's Chancery Court is c) a specialised business court worh judge who are expert in corporate law. This is specialised court as this court has specialised judges having sharp skills to judge according to the case.

Answer-19)

As we know basic rule of partnership is to form an agreement between two or more persons having same goals for the business.

So, the court consider h) Whether there is a partnership agreement or not. If there is no legal agreement stating the terms and conditions of partnership business like about the financing of business etc. Therefore, the agreement is the basic requirement of determining about the partnership existence.

Answer -20)

C) limited liability companies offer liability protection for owners and managers from debt of the company and companies pass through tax treatment this is the correct statemet which states limited liability.