The term ________ refers to a secured creditor's repossession of collateral on a debtor's default and selling, leasing, or otherwise disposing of it in a commercially reasonable manner.

A. repossession B. disposal of the goods C. disposition of collateral D. retaining of collateralAnswer

Which of the following is true of disposition of collateral?

A. Disposition of collateral must be a public proceeding.

B. The debtor is entitled to receive any surplus collateral that remains after disposition.

C. The debtor need not be notified of the disposition as the creditor has complete claim on the collateral.

D. Disposition of collateral occurs when the default is by the creditor.

Which of the following permits a secured lender to recover other property or income from a defaulting debtor if the collateral is insufficient to repay the unpaid loan?

A. Redemption right B. Deficiency judgment C. Disposition of collateral D. Retention of collateral

Gregory borrows $200,000 from Mountain Bank to purchase a plot of land, and Mountain Bank perfects its security interest. Gregory defaults on the loan, and owes an outstanding balance of $80,000. His house has gone down in value to $160,000 at the time of default, but he has other personal assets to satisfy the debt. Which of the following is a course of action for Mountain Bank to recover the debt after foreclosing on the loan?

A. proceed to judgment against Gregory B. file a financing statement C. release a termination statement D. proceed to repossess the collateral

45. Roundwell Motors purchases a manufacturing plant for $15 million, pays $5 million in cash as down payment, and borrows the remaining $10 million from Home Providence Bank. To secure the loan, Roundwell gives the plant as collateral to Home Providence Bank. If Roundwell defaults on their payment, what is the recourse available to Home Providence to recover the loan?

A. buy the plant from Roundwell B. return it to Roundwell C. foreclose on it D. hand it over to the government

7

Which of the following is true of a guarantor in a guaranty arrangement?

A. The guarantor is primarily liable to the principal debtor's debt when it is due.

B. The guarantor can be approached even if the principal debtor is not in default.

C. The creditor can seek first remedy from a guarantor.

D. The guarantor has full legal rights to possession of the real property in this type of arrangement.

A partner who has no right to participate in control of the business and who has limited liability is a:

A. general partner. B. nominal partner. C. secret partner. D. limited partner.

Which of the following is NOT an advantage of a partnership? A. Partners' income taxes may be less than the income taxes would be on a corporation. B. Each partner has limited liability. C. It is possible to bring together more managerial skills than in a sole proprietorship. D. It is possible to bring together more capital than in a sole proprietorship.

Which of the following is not true regarding a partnership name?

A. The name selected may not be the same as or deceptively similar to the name of any other existing business.

B. It may be a fictitious name. C. It may not be likely to indicate to the public that it is a corporation. D. It may not be the name of any one of the partners.

A ____ is an unincorporated business association consisting of at least one general partner and at least one limited partner.

A. joint venture B. limited liability company C. limited liability partnership D. limited partnership

Which of the following is true of a partner's fiduciary duty?

A. The RUPA's provision regarding the fiduciary duty is not exclusive, but leaves further development of the fiduciary duty of partners to the common law of agency.

B. The RUPA provides that a partner does not violate the duty of loyalty merely because the partner's conduct furthers the partner's own interest.

C. The fiduciary duty extends to the formation of the partnership, even when the parties are negotiating at arm's length.

D. The duty not to compete continues for a reasonable time after dissociation. 8

Which of the following is the correct definition for a partnership?

A. An association of two or more persons with one or more general partners and one or more limited partners

B. A legal entity ordinarily consisting of an association of numerous individuals C. An association of two or more persons to carry on as co-tenants in business D. An association of two or more persons to carry on as co-owners a business for profit

The UPA grants each partner the right to an account whenever: A. his partners wrongfully exclude him from the partnership business. B. a partner makes a profit in violation of his fiduciary duty. C. circumstances render it just and reasonable. D. All of these are reasons a partner may demand an account.

Which of the following expresses the right one has to choose her partners? A. Partnership by estoppel B. Delectus personae C. Entity theory

D. Fiduciary relationship

General Widget partnership assets amount to $34,000 after liquidation. Frank, Gene, and Hank, equal partners, each contributed $3,000 into the capital pool at the inception of the business. Gene later loaned the business $5,000. They owe $23,000 to creditors for inventory. What will Gene get in distribution, assuming there is no agreement on the distribution of profits?

A. $7,000 B. $5,000 C. $8,000 D. $11,000

The principal legal duties imposed upon partners in their relations with one another include: A. the fiduciary duty or the duty of loyalty.

B. the duty to compensate other partners for their time and efforts spent on partnership business.

C. a duty to devote full time and expertise to the partnership. D. a duty to vote for candidates that will help the business.

9

The Oak Grove Partnership decided it would buy personal computers for use by each partner. Cromwell, a partner, had an ownership interest in a computer store. He thought he could get the computers for the partnership at the best price because of his inside position, and he told his partners at Oak Grove about his position. He did obtain eight computers for $150 over manufacturer's price, which was $250 less per computer than the next lowest bid. What consequence?

A. There was a sale, but no profit to the computer store.

B. There was a sale, but the computer store would only receive a percentage of the profit equal to Cromwell's ownership interest in the store and the partnership would receive the balance.

C. There was a sale, and the computer store would receive the profit of $150 per computer. D. There would be no sale, because Cromwell had an interest in both businesses.

Which of the following is not a characteristics of a corporation? A. It has perpetual existence. B. It is a legal entity of its own. C. It is able to be sued and to sue.

D. It is usually managed by its shareholders.

The bylaws of the corporation:

A. are adopted as one of the first items of business at the organizational meeting held promptly after incorporation.

B. may contain any provision for managing the business not inconsistent with law or the charter. C. may be repealed by the board of directors. D. All of these are true.

Charles Bonney, the sole stockholder of Kid Corporation, wrongfully used the corporation to avoid a personal liability. A court's disregard of the corporate entity to hold Bonney personally liable is called:

A. limited liability. B. ultra vires. C. diversity of interest. D. piercing the corporate veil.