Brainscape's Knowledge GenomeTM


Top Flashcards (Certified)
All Flashcards

Wiley CPA REG 2014 > Business Law 2 > Flashcards

Business Law 2 Flashcards

(105 cards)

Start Studying
1
Q

What does the acronym PBGC stand for?

A

Pension Benefit Guaranty Corporation.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What is the purpose of pension and retirement plan liability?

A

Pension and retirement plan liability protects plans by establishing standards of responsibility and conduct upon plan fiduciaries.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What is the purpose of the Employee Retirement Income Security Act of 1974 (ERISA)?

A
  1. Protect employee rights in existing pension plans; 2. Offer tax incentives to employers and employees to fund employee benefit plans.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

List the two types of plans to which the Employee Retirement Income Security Act of 1974 (ERISA) apply.

A
  1. Employee pension benefit plans; 2. Employee welfare benefit plans.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Define “defined-contribution plans”.

A

Plans that specify annual fixed-share contributions to be made by an employer into a retirement account.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Define “defined-benefit plans”.

A

Plans that ensure eligible employees and their beneficiaries a specified monthly income for life.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

What are the duties of a fiduciary?

A

Act with reasonable care and discharge duties solely in interests of plan’s participants.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

What does the acronym COBRA stand for?

A

Consolidated Budget Reconciliation Act.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

What is the purpose of the Occupational Safety and Health Act of 1970?

A

To promote safety standards and job safety.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Distinguish between mandatory and elective coverage of workers’ compensation benefits.

A

Most states require all employers to carry workers’ compensation plans. In some states it is elective, however, those who elect not to carry benefits can be sued by injured employees.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

What two qualifying events give rise to health coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA)?

A

Termination or Reduction of hours causing loss of health insurance.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

What is the purpose of the Workers’ Compensation Act?

A

To provide nearly-automatic compensation for employees who suffer work-related injuries or diseases.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

What amount of leave is an eligible employee entitled to under the Family and Medical Leave Act of 1993?

A

12 weeks of unpaid leave without losing the job.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Define “quid pro quo”.

A

The concept of getting something of value in return for giving something of value. For a contract to be binding, it usually must involve the exchange of something of value.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

List the employers who are exempt from Occupational Safety and Health Act of 1970 regulations.

A

Federal government, State government, Certain industries subject to other safety regulations.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What does the acronym OSHA stand for?

A

Occupational Safety and Health Act of 1970

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

What are the requirements for an employee to be eligible for the benefits outlined in the Family and Medical Leave Act (FMLA)?

A

Employee must have worked for employer: At least 12 months; AND at least 1250 hours in those months.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

What entities are covered by the Family and Medical Leave Act (FMLA)?

A
  1. Employers with over 50 employees in a 75 mile radius; 2. State and local government agencies.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

To whom does the Consolidated Omnibus Budget Reconciliation Act (COBRA) apply?

A

Companies with 20 or more employees.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Define “lock-out”.

A

Action taken by employers to bar workers from coming to work, sometimes in anticipation of a threatened strike.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

List the worker’s rights protected by the National Labor Relations Act.

A

Right to form a union; Right to collectively bargain; Right to act collectively (strike).

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

What Act is known as the Taft-Hartley Act, named after its sponsors, Senator Robert Taft and Representative Fred A. Hartley, Jr.?

A

The Labor-Management Relations Act of 1947.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Define “agency shops”.

A

Agreements allowing employees not to join the union but to pay fees to cover union services.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

List actions that are deemed union unfair labor practices.

A

Coercing employees; Requiring employees not to do business with nonunion companies; Refusing to bargain collectively in good faith; Illegal strike or secondary boycott.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
List actions that are deemed employer unfair labor practices.
Interfering with organizing activity; Bribing workers; Threatening workers; Refusing to bargain collectively in good faith; Dominating union; Discriminating against union members.
26
What percentage of employees must sign authorization cards to enable a union to seek certification?
30%.
27
What Act prohibits court injunctions against many union organizing activities, particularly peaceful strikes?
The Norris-LaGuardia Act.
28
Define "collective bargaining".
Negotiations between management and a union.
29
List actions that are deemed unfair labor practices.
Coercing employees; Requiring employees not to do business with nonunion companies; Refusing to bargain collectively in good faith; Illegal strike or secondary boycott.
30
What Act is known as the Landrum-Griffin Act?
The Labor-Management Reporting and Disclosure Act of 1959.
31
What Act is known as the Wagner Act, named after its sponsor New York Senator Robert F. Wagner?
The National Labor Relations Act of 1935.
32
Define "market power".
The ability to raise prices without losing most customers.
33
What is the main goal of antitrust laws?
To promote economic competition.
34
List some examples of antitrust statues.
1. The Sherman Act (1890); 2. The Clayton Act (1914); 3. Federal Trade Commission Act (1914); 4. Robinson-Patman Act (1936);
35
Define "collusion".
Activity that may be evidenced by communications between the parties, opportunity to conspire, uniformity of action, etc.
36
What activity is generally exempt from antitrust laws?
Labor union collective bargaining activity.
37
True or False: §1 of the Sherman Act bans contracts, combinations, or conspiracies in restraint of trade.
True. The Sherman Act bans these activities.
38
List the elements of copyright ability?
An expressive work must be Fixed in some tangible medium of expression; Creative; Original.
39
List the uses of material that may be protected against copyright infringement claims by the "fair use" defense.
Criticism; Comment; News reporting; Teaching; Scholarship; Research.
40
What protections are provided by copyrights?
They protect original works of authorship.
41
List the four types of intellectual property.
Copyright, Patent, Trademark, Trade Secret.
42
What is the length of a copyright protection?
Usual: Life of author + 70 years; Work for hire: shorter of 95 years from date of publication or 120 years from date of creation.
43
What purpose do copyrights serve?
They reward creative expression.
44
List the subject matters that are patentable.
Processes; Machines; Products; Compositions of matter; Any improvement upon the above; New plant varieties.
45
List the elements of patentability.
Patentable subject matter; Useful; Novel; Nonobvious.
46
What is the length of a patent protection?
Utility patent: 20 years from filing; Design patent: 14 years from filing.
47
Where are patents filed?
At U.S. Patent and Trademark Office (within one year of invention).
48
What purpose does a patent serve?
The purpose is to encourage inventive activity.
49
Define "patent".
A government-granted exclusive right to make, use or sell an invention.
50
List the key money laundering statutes.
Bank Secrecy Act of 1970; Money Laundering Control Act of 1986.
51
Define "money laundering".
The process by which one conceals the existence, illegal source, or illegal application of income and disguises that income to make it appear legitimate.
52
List the two key prohibitions related to money laundering.
Transaction money laundering; Transportation money laundering.
53
What is the maximum number of shareholders in a Subchapter S Corporation?
100 shareholders.
54
Defined "limited liability partnership (LLP)".
A partnership that protects partners from liability for other partners' torts.
55
What is the most common type of corporation form?
Most corporations are this type.
56
Define "sole proprietorship".
A single-owner business.
57
Define "limited partnership".
A partnership with at least one general partner and one limited partner.
58
Define "joint venture".
A one-shot general partnership.
59
Define "corporation".
An artificial legal entity whose owners typically enjoy limited liability.
60
For what tort liabilities are partners in a limited liability partnership responsible?
Partners are liable for torts committed by themselves or those they supervise.
61
Define "general partnership".
An association of two or more persons to carry on as co-owners a business for profit.
62
List the requirements for a Subchapter S corporation.
Domestic corporation; All shareholders consent; No more than 100 shareholders; All shareholders must be individuals estates or certain exempt organizations or trusts; and Only one class of stock.
63
Define "Subchapter S Corporation".
A form of corporation that eliminates double taxation if certain requirements are met.
64
Define "limited liability limited partnership (LLLP)".
A limited partnership where no partner need be generally liable.
65
Define "limited liability company (LLC)".
A company that allows owners to gain liability-limiting advantages of corporate form while enjoying single taxation.
66
List the items generally required in articles of incorporation.
Name indicating a corporate form; Number of authorized shares; Address of registered office; Name of registered agent; Names and addresses of incorporators.
67
List the conditions under which promoters may profit in deals with a corporation.
Informed approval by majority of owners; or Informed approval by majority of board.
68
What formation forms do not require a formal filing?
Sole proprietorship; General partnership.
69
List the steps in organizing a corporation.
File articles of incorporation with Secretary of State; Hold an organizational meeting; Draft and adopt by-laws; Obtain certificates of authority to do business.
70
What is the rationale for "piercing the corporate veil?"
To prevent the corporate entity from being used to defeat public convenience, justify wrong, commit fraud, or protect crime.
71
List the reasons for piercing the corporate veil.
Commingling of funds; Diversion of corporate assets to personal use; Failure to maintain corporate formalities; Failure to adequately capitalize.
72
List the operating forms of a limited liability corporation (LLC).
Owner-managed; Manager-managed.
73
Who is responsible for the operation of a sole proprietorship?
Sole proprietor makes all decisions.
74
Describe the corporate triangle.
Shareholders elect directors who make broad policy and select officers who run things day-to-day.
75
List the "extraordinary" actions that require general partnership unanimity to be approved.
Admitting a new partner; Assigning partnership property; Disposing of goodwill; Doing any act making it impossible to carry on ordinary business.
76
What is meant by "piercing the corporate veil?"
Imposing personal liability upon shareholders under particular circumstances.
77
Who is responsible for the operation of a general partnership?
All partners have equal vote, absent agreement to contrary.
78
List the general causes for a "dissociation" of a general partnership.
Notice of a partner's desire to dissolve; Death of a partner; Bankruptcy of a partner; Expulsion of a partner.
79
What happens upon dissociation of a general partnership?
Either: That partner's interest is bought out; or Partnership is wound up.
80
List the categories of corporate dissolution.
Voluntary Involuntary by: Administratively by Secretary of State Judicially by courts, in: Actions by Attorney General; Actions by shareholders; Action by Creditors; Where judgments are unpaid.
81
List the events that terminate a sole proprietorship.
When sole owner dies, retires, or sells the business.
82
List the major protections of shareholders in an organic change.
Procedures requiring director and shareholder approval; Appraisal rights.
83
How is a partner's account balance in a partnership determined?
Contribution + share of profits - share of liabilities = account balance.
84
What test should be met before corporate shares are issued?
Quality Tests; Quantity Tests.
85
How do partners share profits and losses?
Equally (absent agreement to the contrary).
86
List the instances when corporate distributions are considered illicit.
If they render corporation: Equity insolvent; or Bankruptcy insolvent.
87
List the items for which partners are reimbursed.
Payments made for partnership; Liabilities incurred on behalf of partnership; Advances made beyond agreed contribution.
88
Who authorizes corporate distributions?
Board of directors, not shareholders.
89
Define "watered stock".
Stock issues for less than par value or less than amount authorized by board.
90
List the basic corporate shareholder rights.
To vote for directors; To properly inspect corporate records; To have financial priorities respected; To exercise appraisal rights; To file derivative lawsuits; To exercise preemptive rights.
91
List the duties of directors and officers of a corporation.
Duty of attention; Duty of care; Duty of loyalty.
92
Describe the concept of "delectus personae."
General partners may veto others' attempt to join as new partners.
93
What is the condition under which general partners may use partnership property?
Only for partnership purposes.
94
What are the management rights of a partner in a general partnership?
The right to share equally in management.
95
List the duties that partners owe each other.
Duty of Loyalty; Duty of Care.
96
What actions are available to creditors of individual partners?
Creditors may get a judicial charging order, but not seize partnership property.
97
What is a partner's right to payment?
A partner is generally not entitled to be paid for work for the partnership.
98
Describe the business judgment rule.
Courts' refusal to second guess decisions of directors absent showing of bad faith or gross abuse of discretion.
99
List the conditions under which a partnership may still be bound if a partner acts without authority.
Apparent authority existed; or Partnership ratifies the act.
100
Describe the corporate pyramid.
Shareholders elect directors who set the broad policies of the firm and select officers who run the business day-to-day.
101
What entity is responsible for the business and affairs of a corporation?
Board of Directors.
102
Under what condition is a partnership generally liable for the partners' torts?
Torts are committed within the scope of employment or authority.
103
True or false: The basis of general partnership authority is based on agency law.
True. It is based on Agency law.
104
List the major organic changes of a corporation that require shareholder approval.
Sale of major corporate assets; Mergers or consolidations; Dissolution; Amendments to articles of incorporation.
105
List the actions included under the authority of a Director on the Board of Directors.
Borrowing money; Selling corporate; Hiring and firing officers; Declaring dividends; Making other distributions; Setting salaries of employees and themselves; Proposing major organic changes for shareholder approval.

Wiley CPA REG 2014 (4 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions