Kelly is a partner in a consignment store business. She owes a personal debt to a creditor who is very aggressive about collecting that debt. Kelly may ____________.

sell her ownership interest in the partnership to satisfy the debt

allow the creditor to attach a lien to the partnership's property to satisfy the debt

assign the value of her right to partnership distributions to the creditor to satisfy the debt

not use any partnership proceeds to satisfy the debt

Each of the following is an advantage of the limited liability company structure except ____________.

that it combines limited liability with pass-through taxation

that it is a fairly flexible business form

that the required formalities that govern this structure are relatively easy to comply with

that limited liability companies have a higher success rate than other business structures

Under the default rule of North Carolina's Limited Liability Company Act, distributions of a limited liability company's profits are allocated ____________.

evenly among all members

on the basis of a member's percentage of total contributions to the LLC

in accordance with the efforts of each member to produce a profit

only upon dissolution and winding up

Members of a limited liability company must be natural persons.

True

False

The document that brings a corporation into existence in North Carolina is the ____________.

Bylaws

Operating Agreement

Articles of Organization

Articles of Incorporation

A limitation of common stock is that its holders ____________.

have no ownership interest in the corporation

are not generally allowed to vote on who will sit on the board of directors

are not guaranteed either dividends or payment from the company's assets in the case of bankruptcy

own an investment that is very low-risk

A corporate officer's duty of care includes each of the following except ____________.

good faith actions taken in the best interest of the company

informed decision making

reasonable supervision of subordinates

divestment of ownership shares to avoid conflict of interest

The corporate form is a popular business entity because of each of the following except ____________.

it is a very familiar business form with a well-established body of law

it provides its owners with limited personal liability

it is relatively easy and inexpensive to form and maintain

its ownership model allows for relative ease of transfer

Betty was a tax accountant with Ron's Tax Services. Betty decided to do some freelance tax consulting in the evenings and on weekends to earn some extra money on the side. Ron's Tax Services is not aware of Betty's consulting work. Betty ____________.

has not breached any fiduciary duty of loyalty to Ron's because her consulting is done on her own time

has not breached a fiduciary duty of loyalty to Ron's because her behavior does not reflect badly on the firm

Betty has breached a fiduciary duty to Ron's because she is using her expertise in accounting

has breached a fiduciary duty of loyalty to Ron's because she is competing with her employer

Maria was employed by a manufacturing company as a sales representative. A grateful customer gave her tickets to an upcoming theater performance in appreciation for her hard work on a complicated supply contract. Can Maria keep and use the theater tickets?

Yes. The tickets were given to Maria personally and intended for her use.

Yes, but only if she discloses the gift to her employer and the employer consents to her keeping and using the tickets.

No. An agent is not allowed under any circumstances to personally profit, beyond the agreed compensation from her principal, as a result of the agency relationship.

No. Maria should either turn the tickets over to her employer or sell them and turn over the proceeds to her employer.

Once a legislative body has enacted a law to address a need, it may do an administrative agency and delegate authority to that agency to implement that law.

True

False

Most appeals to the United States Supreme Court are discretionary with that Court. If enough justices agree to accept a case for review, the Court will issue a writ of certiorari directing the lower court to hand up the file.

True

False

A party who is dissatisfied with a decision from the highest state court may petition the United States Supreme Court if ____________.

both parties agree to seek review by the United States Supreme Court

the state court files an official request for the United States Supreme Court to review the case

the dissatisfied party pays a premium surcharge in addition to the standard court costs

the state court case involves a question that implicates federal law or federal constitutional concerns

Charles and Lee are partners in Mountain Sports, which sells outdoor sporting equipment. Charles manages the business. Unless the partnership agreement states otherwise, Charles is ____________.

entitled to reasonable market wages as compensation for his work on behalf of the business

not entitled to compensation for his work on behalf of the business

entitled for the value of his work on behalf of the business to be attributed as additional capital contributions

entitled to compensation in proportion to his original captial contribution