Business Structures 2 of 3 (39)

Question 1

Notice

Answer 1

The notification of third parties that a partner does not have the authority to bind the partnership and the other partners beginning when the notice is given, which might be actual, in which case the third parties are told directly, generally required when the third party has done business with the partnership before, or constructive, in which case notice is published in a manner that third parties should reasonably be expected to be aware of, such as in trade periodicals, which is considered sufficient for parties that have not previously done business with the partnership.

Question 2

Limited Partnership

Answer 2

A partnership (governed by RULPA - Revised Uniform Limited Partnership Act) with one or more general partners and one or more limited partners. A general partner has unlimited liability for the obligations of the partnership. A limited partner’s liability for obligations is limited to the amount invested in the partnership.

Question 3

C Corporation

Answer 3

An entity separate from its owners, governed by the laws established under the Model Business Corporation Act (MBCA) and providing its owners with limited liability. It is a taxable entity (1120), with an independent life (perpetuity) and a centralized management (board of directors).