BLAW TEST 3
1) An at-will employee is referred to as
** none of the other answers
** one who has not contract at all.
**one who has an employment contract with the employer but who can be discharged for any
reason or no reason
** one who has an employment contract for a fixed term.
2) Bill sprivvins was an agent for amalgamated consolidated, Inc. While carrying out his agency
duties, Bill drove his motor vehicle negligently, proximately causing injuries and property
damages to Bo Ridley.
** Bill’s negligence will not be imputed to amalgamated consolidated, Inc. since respondent
superior never applies to the principal agent relationship.
** Whether respondeat superior applies will depend on whether bill was an employee or an
independent contractor of Amalgamated consolidated, Inc.
** Bill’s negligence will be imputed to Amalgamated consolidated, Inc. under respondeat
superior since the tort occurred while bill was engaged in his duties as agent.
3) an employer can never be vicariously liable in tort law.
** False/true
4) Which of the following is subject to unlimited personal liability following is true?
**Raced based employment decisions are always illegal.
**Age based employment decisions are always illegal.
**Gender based employment are always illegal.
**None of the other answer are true.
5) In an employer/ independent contractor situation
**the independent contractor will always be an agent
**respondeat superior generally does not apply
**The employer is liable for a tort of the independent contractor if the tort was committed within
the course and scope of employment.
6) Discrimination is always illegal.
**False/true
7)A corporation and partnership are both separate entities .
**True/false
8) A limited liability company
**treated the same as partnership for all purposes
**is separate entity
**is identical to an corporation.
9) An agent is always an independent contract for
**false/true
10) which of the following statements is true?
** a partnership is a separate entity.
** a limited liability company does not pay income taxes, but profits and losses are passed
through to the individual members
11) what do a partnership, a chapter S corporation and a limited liability company all have in
common?
**all treat income and expenses as being “passed through” to the partners, shareholders or
members, as the case may be.
**each is a separate entity for all purposes.
**none of them have to file an income tax return.
12) which of the following statement is correct?
**A “C” corporation is a separate entity.
**An “S” corporation is not a separate entity.
** A limited liability company is not a separate entity.
13) Which of the following is not a fiduciary?
** A director.
**an officer
**an agent
**a professional baseball player.
14) Erale and Bert are the only shareholders in Farthington Frog Farms, Inc(“FFF”). Chapter S
corporation. The corporation has been business for 15 years, but has now experienced a down
turn in business due to a recessionary and is seeking new investors. Thibedeaux Dideaux, a
Canadian, has offered to invest $350,000 in FFF stock.
** FFF can accept Thibedeaux’s investment without forfeiting its pass-through tax treatment or
its liability immunity for its shareholders.
**in order for FFF to accept Thibedeaux’s investment and still retain its pass-through tax
treatment and liability immunity for its shateholders, FFF will have to reorganize as a
partnership.
** in order for FFF to accept Thibedeaux’s investment and still retain its pass-through tax
treatment and liability immunity for its shateholders, FFF will have to reorganize as a Ccorporation.
** in order for FFF to accept Thibedeaux’s investment and still retain its pass-through tax
treatment and liability immunity for its shateholders, FFF will have to reorganize as a limited
liability company.
15) in a limited partnership a general partner’s liability is the same as a limited partner’s.
**false/true
16) in a limited partnership general partner’s liability exposure is the same as a shareholder in a
corporation.
**True/false
17) in a limited partnership a general partner’s liability exposure is the same as that of a partner
in a ordinary partnership.
**true/false
18) a limited liability company can have the same tax advantages as
**both of the other answer are correct.
**a partnership
**an S Corporation.
19) A corporation may or may not be a separate entity, depending on whether it is a C
corporation or an S corporation.
**true/false
20) a limited liability company is a separate entity for all purposes.
**false/true
21) a limited liability company will be taxed like an S corp.
**true/false
22) a limited partnership is identical for all purposes to a limited liability company.
**true/false
23) A C-corporation is essentially the same as a limited liability company.
**true/false
24) in a limited liability company, profits and losses pass through to members.
**false/true
25) a corporation requires the state’s permission to exist.
**true/false
26) a limited liability company is created by contract only.
**false/true.
27) corporation law is an extension of principal-agent law.
**true/false
28) each partner is an ordinary partnership is an agent for the partnership.
**false/true
29) each partner in an ordinary partnership is an agent for the other partners.
**true/false
30) a limited liability company can have any number of members.
**true/false
31) there is a limit on the number of shareholders in an S-corporation.
**true/false
32) an employment contract which call for an employment term of five years is
** illegal
** none of the other answers are correct
** void
**employment at will
33) bankruptcy cases can be filed in either state or federal court.
**true/false
34) bankruptcy law is not as debtor-friendly as it used to be.
**true/false
35) apparent authority of an agent
**is a synonym of actual authority
**is based on the principal’s acts or failure to act.
36) the act school of flying and refrigerator repair, inc. finds it necessary to seek protection from
creditors in an effort to re-organize their business. A voluntary petition in bankruptcy would be
filed under which of the following provisions of the united states bankruptcy code?
** chapter 11
** chapter 7
** chapter 13
37) a creditor who holds a promissory note secured by a lien on real estate is
** violating law.
**a general creditor
** a secured creditor.
38) the negligence in the course and scope of employment of which of the following will result
in vicarious liability of the employer?
** an independent contractor.
** an employee.
** both an employee and an independent contractor.
39) a security interest held by a creditor on inventory in bubba’s sporting goods retail store is
** a floating lien.
** illegal
** not enforceable.
40) in a bankruptcy case, the automatic stay will result in
** the halting of all collection efforts against the debtor.
** collection efforts being intensified.
41) the appointment of an agent by a principal
** gives the agent contractual authority under respondeat superior
** gives the agent authority to bind the principal contractually.
42) in a voluntary chapter 13 bankruptcy case the debtor is asking for
** money damage
** a wage-earner’s plan
** straight liquidation
** reorganization
43) the constitutional basis for congress passing bankruptcy legislation is found in
** article V
** article III, sec 2
** article II sec 3
** article I sec 8
44) a promissory note secured by corporate stock is
** a secured transaction
**illegal
**a tort
45) larry acting as curly’s agent and acting with actual authority enters into a contract with moe.
The parties to the contract are
** larry and curly
**curly and moe
**larry, curly and moe
46) under the U.S. bankruptcy code. A so-called “wafe earner’s” petition will be filed under
** chapter 11
**chapter 7
**chapter 13
47) an employment contract in which either party can terminate the employment without cause
**is illegal
** is governed exclusively by federal law
**is an employment at will contract.
48) bankruptcy case are exclusively filed in state bankruptcy courts.
**true
**false
49) it is possible for a principal to be held liable on a contract based on respondeat superior.
**false
**true
50) the filing of a bankruptcy petition result in
**the debtor being liable on any unperformed contracts
**an automatic stay
**the debtor being liable for all torts committed by debtor.
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1) An at-will employee is referred to as
** none of the other answers
** one who has not contract at all.
**one who has an employment contract with the employer but who can be discharged for any
reason or no reason
** one who has an employment contract for a fixed term.
2) Bill sprivvins was an agent for amalgamated consolidated, Inc. While carrying out his agency
duties, Bill drove his motor vehicle negligently, proximately causing injuries and property
damages to Bo Ridley.
** Bill’s negligence will not be imputed to amalgamated consolidated, Inc. since respondent
superior never applies to the principal agent relationship.
** Whether respondeat superior applies will depend on whether bill was an employee or an
independent contractor of Amalgamated consolidated, Inc.
** Bill’s negligence will be imputed to Amalgamated consolidated, Inc. under respondeat
superior since the tort occurred while bill was engaged in his duties as agent.
3) an employer can never be vicariously liable in tort law.
** False/true
4) Which of the following is subject to unlimited personal liability following is true?
**Raced based employment decisions are always illegal.
**Age based employment decisions are always illegal.
**Gender based employment are always illegal.
**None of the other answer are true.
5) In an employer/ independent contractor situation
**the independent contractor will always be an agent
**respondeat superior generally does not apply
**The employer is liable for a tort of the independent contractor if the tort was committed within
the course and scope of employment.
6) Discrimination is always illegal.
**False/true
7)A corporation and partnership are both separate entities .
**True/false
8) A limited liability company
**treated the same as partnership for all purposes
**is separate entity
**is identical to an corporation.
9) An agent is always an independent contract for
**false/true
10) which of the following statements is true?
** a partnership is a separate entity.
** a limited liability company does not pay income taxes, but profits and losses are passed
through to the individual members
11) what do a partnership, a chapter S corporation and a limited liability company all have in
common?
**all treat income and expenses as being “passed through” to the partners, shareholders or
members, as the case may be.
**each is a separate entity for all purposes.
**none of them have to file an income tax return.
12) which of the following statement is correct?
**A “C” corporation is a separate entity.
**An “S” corporation is not a separate entity.
** A limited liability company is not a separate entity.
13) Which of the following is not a fiduciary?
** A director.
**an officer
**an agent
**a professional baseball player.
14) Erale and Bert are the only shareholders in Farthington Frog Farms, Inc(“FFF”). Chapter S
corporation. The corporation has been business for 15 years, but has now experienced a down
turn in business due to a recessionary and is seeking new investors. Thibedeaux Dideaux, a
Canadian, has offered to invest $350,000 in FFF stock.
** FFF can accept Thibedeaux’s investment without forfeiting its pass-through tax treatment or
its liability immunity for its shareholders.
**in order for FFF to accept Thibedeaux’s investment and still retain its pass-through tax
treatment and liability immunity for its shateholders, FFF will have to reorganize as a
partnership.
** in order for FFF to accept Thibedeaux’s investment and still retain its pass-through tax
treatment and liability immunity for its shateholders, FFF will have to reorganize as a Ccorporation.
** in order for FFF to accept Thibedeaux’s investment and still retain its pass-through tax
treatment and liability immunity for its shateholders, FFF will have to reorganize as a limited
liability company.
15) in a limited partnership a general partner’s liability is the same as a limited partner’s.
**false/true
16) in a limited partnership general partner’s liability exposure is the same as a shareholder in a
corporation.
**True/false
17) in a limited partnership a general partner’s liability exposure is the same as that of a partner
in a ordinary partnership.
**true/false
18) a limited liability company can have the same tax advantages as
**both of the other answer are correct.
**a partnership
**an S Corporation.
19) A corporation may or may not be a separate entity, depending on whether it is a C
corporation or an S corporation.
**true/false
20) a limited liability company is a separate entity for all purposes.
**false/true
21) a limited liability company will be taxed like an S corp.
**true/false
22) a limited partnership is identical for all purposes to a limited liability company.
**true/false
23) A C-corporation is essentially the same as a limited liability company.
**true/false
24) in a limited liability company, profits and losses pass through to members.
**false/true
25) a corporation requires the state’s permission to exist.
**true/false
26) a limited liability company is created by contract only.
**false/true.
27) corporation law is an extension of principal-agent law.
**true/false
28) each partner is an ordinary partnership is an agent for the partnership.
**false/true
29) each partner in an ordinary partnership is an agent for the other partners.
**true/false
30) a limited liability company can have any number of members.
**true/false
31) there is a limit on the number of shareholders in an S-corporation.
**true/false
32) an employment contract which call for an employment term of five years is
** illegal
** none of the other answers are correct
** void
**employment at will
33) bankruptcy cases can be filed in either state or federal court.
**true/false
34) bankruptcy law is not as debtor-friendly as it used to be.
**true/false
35) apparent authority of an agent
**is a synonym of actual authority
**is based on the principal’s acts or failure to act.
36) the act school of flying and refrigerator repair, inc. finds it necessary to seek protection from
creditors in an effort to re-organize their business. A voluntary petition in bankruptcy would be
filed under which of the following provisions of the united states bankruptcy code?
** chapter 11
** chapter 7
** chapter 13
37) a creditor who holds a promissory note secured by a lien on real estate is
** violating law.
**a general creditor
** a secured creditor.
38) the negligence in the course and scope of employment of which of the following will result
in vicarious liability of the employer?
** an independent contractor.
** an employee.
** both an employee and an independent contractor.
39) a security interest held by a creditor on inventory in bubba’s sporting goods retail store is
** a floating lien.
** illegal
** not enforceable.
40) in a bankruptcy case, the automatic stay will result in
** the halting of all collection efforts against the debtor.
** collection efforts being intensified.
41) the appointment of an agent by a principal
** gives the agent contractual authority under respondeat superior
** gives the agent authority to bind the principal contractually.
42) in a voluntary chapter 13 bankruptcy case the debtor is asking for
** money damage
** a wage-earner’s plan
** straight liquidation
** reorganization
43) the constitutional basis for congress passing bankruptcy legislation is found in
** article V
** article III, sec 2
** article II sec 3
** article I sec 8
44) a promissory note secured by corporate stock is
** a secured transaction
**illegal
**a tort
45) larry acting as curly’s agent and acting with actual authority enters into a contract with moe.
The parties to the contract are
** larry and curly
**curly and moe
**larry, curly and moe
46) under the U.S. bankruptcy code. A so-called “wafe earner’s” petition will be filed under
** chapter 11
**chapter 7
**chapter 13
47) an employment contract in which either party can terminate the employment without cause
**is illegal
** is governed exclusively by federal law
**is an employment at will contract.
48) bankruptcy case are exclusively filed in state bankruptcy courts.
**true
**false
49) it is possible for a principal to be held liable on a contract based on respondeat superior.
**false
**true
50) the filing of a bankruptcy petition result in
**the debtor being liable on any unperformed contracts
**an automatic stay
**the debtor being liable for all torts committed by debtor.
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