Chapter 11

Question 1

Three basic legal structures

Answer 1

1. Sole proprietorship
2. Partnership
3. Corporation

Question 2

Sole proprietorship

Answer 2

A business owned by one person who has unlimited liability and rights to profits

Question 3

Partnership

Answer 3

A business with two or more owners that make decisions for the business together and share the profits, losses assets, and liabilities

Question 4

Limited partnership

Answer 4

Business partnership wherein there is a general partner with unlimited liability, and one or more limited partners with no official input in daily operations and limited liability

Question 5

Notary

Answer 5

A person who has been authorized by the state to witness the signing of documents

Question 6

Corporation

Answer 6

A legal entity composed of stockholders under a common name

Question 7

Contract

Answer 7

An agreement between two or more parties that is enforceable by law

Question 8

Boilerplate language

Answer 8

It’s standard format for a specific type of legal agreement

Question 9

Contingency

Answer 9

A condition that must be met in order for something else to occur

Question 10

Letter of agreement

Answer 10

A document that puts on oral understanding and writing, in the form of a business letter

Question 11

Signatory

Answer 11

An individual who signs a concert

Question 12

Breach of contract

Answer 12

The failure of a signatory to perform as agreed

Question 13

Statue of limitations

Answer 13

The time period in which legal action may be taken

Question 14

Small claims court

Answer 14

A legal option for solving conflicts involving less than a certain sum of money

Question 15

Arbitration

Answer 15

A method of dispute resolution using an Arbor traitor to act as the decision-maker rather than going to court

Question 16

Bankruptcy

Answer 16

The legal process in which an individual or business declares the inability or impaired ability to pay debts as they come due

Question 17

Service mark

Answer 17

A design that identifies and distinguishes the source of a service rather than a product

Question 18

Electronic rights

Answer 18

The right to reproduce someone’s work online

Question 19

Patent

Answer 19

And exclusive right, granted by the government, to produce, use and sell an invention or process

Question 20

Public domain

Answer 20

Property rights available to the public rather than held by an individual

Question 21

Insurance

Answer 21

A system of protected-for-payment provided by insurance companies to reimburse individuals and organizations when their property or wealth has been damaged destroyed or lost

Question 22

Premium

Answer 22

The cost of insurance

Question 23

Deductible

Answer 23

The amount of loss or damage a policyholder covers before the insurer pays on a claim

Question 24

Permit

Answer 24

An official document that gives a party the right to hold a specific event

Question 25

License

Answer 25

An official document the grants the right to engage in activity for A specified period of time

Question 26

Certificate

Answer 26

An official document that verifies something

Question 27

Advantages of a sole partnership

Answer 27

1. Ease of start 2. Simplicity of registration 3. Fewer government regulations 4. Rapid decision making 5. Greater rights to profits

Question 28

Disadvantages of a sole proprietorship

Answer 28

1. Difficult fundraising 2. Significant time obligations and responsibilities 3. Unlimited personal liability 4. Lack of emotional support 5. Taxation of profits

Question 29

Advantages of a corporation

Answer 29

1. Ability to sell ownership shares 2. Ease of transfer 3. Limitation of personal liability

Question 30

Disadvantages of a corporation

Answer 30

1. Potential for double taxation 2. Loss of founder control 3. Higher start up cost 4. Greater government regulation

Question 31

C corporation

Answer 31

1.Most companies are C corporations 2.they sell ownership shares of stock 3. Shareholders have the right to vote on important Company decision. 4. C corporations can sell more stock issue bonds or secure other type of loans

Question 32

Subchapter S corporation

Answer 32

1. Limits the number of stockholders to 100 2. offers most of the limited liability protection of the more common C corporation 3. income is only text once as the personal income of the owners

Question 33

Professional corporation

Answer 33

Medical practices ,engineering firm's ,law firm's ,accounting firms and certain other can form professional corporations

Question 34

Nonprofit corporation

Answer 34

Corporation set up with a specific mission to improve society ,church's museums, charitable foundations are examples Tax exempt

Question 35

Public benefit corporation

Answer 35

1. Explicitly includes a civic or environmental benefit | 2. must report on social and environmental impact as well as financial performance

Question 36

Limited liability company

Answer 36

Combines the best features of partnerships and corporations and is an excellent choice for many small businesses

Question 37

The four A's of a successful contract

Answer 37

1. Avoid misunderstanding 2. Assure work 3. Assure payment 4. Avoid liability

Question 38

The uniform commercial code

Answer 38

A collection of business law's adoptive family states they cover a broad spectrum of transactions

Question 39

The law of agency

Answer 39

Addresses principal-agent relationships

Question 40

The bankruptcy code

Answer 40

Concerns the inability or impaired ability to pay debts as they come due

Question 41

Chapter 11 Reorganization

Answer 41

1.This form of bankruptcy that can prove to be a lifeline for company

Question 42

Chapter 7 liquidation

Answer 42

Corporation must identify all assets and liabilities turn them over to a trustee and allow them to be sold

Question 43

Chapter 13 individual that re-organization

Answer 43

1. Voluntary filling and the repayment plan can only be filled by the debtor 2. may include full or partial payment of debts through installments 3. must be approved by a bankruptcy judge

Question 44

Intellectual property

Answer 44

Your ideas and creations

Question 45

Trademarks of service marks protect

Answer 45

Your brand identity

Question 46

Copyrights protect

Answer 46

Works of authorship

Question 47

Patents protect

Answer 47

Invented products and processes