Bus 250 Ole Miss Final || with 100% Accurate Solutions.
A partially disclosed principal is also known as: correct answers an unidentified principal.
Tad, the manager of an apartment complex, rented an apartment to Dominique. A few weeks
later, Dominique complained that the hot water did not work. Tad hired Hometown Plumbers to
fix the hot water, but the job was not successful. A few days later Dominique moved out since
she had no hot water. She sued the landlord and Tad for breach of contract. Which of the
following statements is correct? correct answers The landlord is liable, but not Tad.
Grant, the production manager at Grisday, was told by his supervisor to hire Darrell, a 15- year-
old, to operate an industrial machine. Hiring the 15-year-old violates the child labor laws. Grant:
correct answers should not hire Darrell. Grant has a duty to obey Grisday's instructions only if
they are legal and ethical.
Jerry agreed to show Jackie's car to a potential buyer. Jackie was not able to be home since she
had to attend a meeting. After showing the car, Jerry left the keys in it and the car was stolen.
Which statement is correct? correct answers Since Jerry is a gratuitous agent, he will only be
liable for the loss of the car if his conduct constitutes gross negligence.
Katie borrowed $2,500 from Lauren. They agreed that Lauren could take a grouping of Katie's
antiques as collateral. If Katie could not pay, then Lauren could sell the antiques to recover her
money. When Katie could not pay off the loan, Lauren sold the antiques and paid Katie the
proceeds after deducting the balance of the loan. Which of the following statements is correct?
correct answers A. This is an irrevocable agency relationship.
b. All these answers.
c. Katie has neither the power nor the right to terminate the relationship.
d. This is a power coupled with an interest.
Express authority can be created by: correct answers A. words spoken directly to the agent.
b. All these answers.
c. written words given to one person to give to another person, the agent.
d. conduct.
D2D Accounting hired Coco, a CPA, to prepare tax returns. Which statement is correct? correct
answers Coco, as a CPA, is an agent with special skills. She is held to a higher duty than
ordinary negligence.
Katie borrowed $2,500 from Lauren. They agreed that Lauren could take a grouping of Katie's
antiques as collateral. If Katie could not pay, then Lauren could sell the antiques to recover her
money. When Katie could not pay off the loan, Lauren sold the antiques and paid Katie the
proceeds after deducting the balance of the loan. Which of the following statements is correct?
correct answers Only Lauren can terminate the relationship.
Chiao has agreed to install a new shower in the bathroom of Tiffany's house for $1,000. Chiao is:
correct answers an independent contractor.
,If the agent is disloyal to the principal: correct answers a. the agency agreement automatically
terminates and the principal may rescind the transaction.
b. All these answers.
c. the principal has a right to recover any profits earned as a result of his agent's disloyal
conduct.
d. the principal has the right to collect any actual damages sustained as a result of the agent's
disloyalty
Jilly is a salesperson in a hardware store. As such, she: correct answers a. is an agent of the store.
b. All these answers.
c. has implied authority to conduct sales transactions.
d. has express authority to conduct sales transactions.
Conner hired Travis to sell his house. Which statement is correct? correct answers Conner is
Travis's principal.
The death of the agent: correct answers automatically terminates the agency relationship.
Mack, Lera, and Tito are considering forming a business. What factors should they consider in
making a choice of organization? correct answers a. Whether there is personal liability for the
owners.
b. How the owners will be taxed.
c. All of these answers.
d. Ease of creation and operation.
The term "S Corporation" comes from: correct answers the Internal Revenue Code.
Corporations can continue without the existence of their founders, and therefore have: correct
answers perpetual existence.
The form of business ownership that is the most easily transferable is the: correct answers
corporation.
Mack, Lera, and Tito are considering forming a business. What factors should they consider in
making a choice of organization? correct answers a. Whether there is personal liability for the
owners.
b. How the owners will be taxed.
c. All of these answers.
d. Ease of creation and operation.
Which of the following would not be personally liable for the debts of the business? correct
answers A general partner in a limited liability limited partnership.
The term "S Corporation" comes from: correct answers the Internal Revenue Code.
,Corporations can continue without the existence of their founders, and therefore have: correct
answers perpetual existence
Janet was a limited partner in a retail business that was sued by a customer who fell in the store.
The customer claimed the business was negligent in caring for its floors. Which statement best
describes Janet's potential liability? correct answers Janet can only be liable to the amount of her
investment
Henry and Ty have pooled their money together to buy real estate but have filed no formal
papers to form a business. Henry, a lawyer, handles all the legal matters and Ty, a real estate
broker, finds buyers for the property they have subdivided. Henry and Ty are engaged in a:
correct answers partnership.
Which of the following forms of organization is a compromise between starting one's own
business as an entrepreneur and working for someone else as an employee? correct answers
Franchise.
The form of business ownership that is the most easily transferable is the: correct answers
corporation.
A limited liability company, unlike a Subchapter S corporation, can have members that are:
correct answers a. partnerships.
b. nonresident aliens.
c. All of these answers.
d. corporations.
Jake, his parents, and three brothers own all the stock of their family farm corporation. This
corporation, which is taxed as a corporation, is probably: correct answers a closely held
corporation.
In order to obtain limited liability, Tim and Delia formed an LLC to operate their catering
business. They sometimes deposited the proceeds from catering jobs into their personal checking
accounts and if they needed to pay personal bills and were short of funds, they used the business
account. If creditors of the business cannot get payment for their invoices, is there anything a
court can do to help the creditors? correct answers Yes. Courts would be likely to disregard the
LLC form and hold Tim and Delia personally liable for the business debts.
E. I. Sorenson is a writer with a best selling novel. He wishes to create a corporation called
"Sorenson, Inc." He will be the only shareholder. Can Sorenson incorporate his business of
writing? correct answers Yes, this would be the incorporation of a sole proprietorship.
Celia wishes to buy a national franchise. What information is the seller legally required to
provide before she buys the franchise? correct answers a. Whether the company has gone
through bankruptcy proceedings in the prior 10 years.
b. All fees required to be paid.
c. All of these answers.
, d. Any litigation against the company for the prior ten years and any claims the company made
against franchisees during the prior year.
Jimmy was a partner in a partnership, but quits. What has just occurred? correct answers
Dissociation.
Arthur, Juan, and Monica form a partnership. There is no agreement as to the duration of the
partnership. The partnership is a: correct answers partnership at will.
Which of the following is a rightful dissociation? correct answers A partner in a partnership at
will serves notice that he intends to withdraw.
Which of the following would be evidence that two people intend to be partners? correct answers
a. An agreement to share profits of a business.
b. Agreeing to share in the business's losses.
c. Referring to each other as "partners."
d. All of these answers.
Which of the following is true of a partnership? correct answers a. Each partner has equal rights
in the management and conduct of the business, unless the partners agree otherwise.
b. Partners are agents of the partnership and have the power to bind the partnership through
actual, implied, or apparent authority.
c. If the partnership is large, usually one or a few partners are designated as managing partners
or members of an executive committee.
d. All of these answers.
Brad, Janet, and Ravi are partners. Their agreement did not address dissociation nor how long the
partnership would last. Brad decided to leave the partnership. When Brad serves notice he
intends to withdraw: correct answers the partnership can either buy him out and continue in
business or wind up the business and terminate the partnership.
Marsha is a partner with Hank and Mark. She sells her interest in the partnership to Matt. Which
statement below is the most accurate? correct answers Hank and Mark must approve the sale for
Matt to become a full partner.
Meredith and Todd have a written agreement wherein they will share the losses of their joint
business. This agreement is _________ that they are partners. correct answers strong evidence
Ingrid and Astrid formed a partnership in which they agree to share profits 60 percent to Ingrid
and 40 percent to Astrid. Losses will be shared: correct answers 60 percent to Ingrid and 40
percent to Astrid, unless otherwise agreed.
Drake dissociated from a partnership. To protect himself from debts of the partnership after he
leaves, Drake should: correct answers file a statement of dissociation with the Secretary of State.
