CLA/CP Exam FREE CLA/CP Business Organization Types Questions and Answers 2

Question 1

Which type of business organization requires filing articles of organization with the state?

Accepted Answer

Limited liability company (LLC)

Answer

Sole proprietorship

Answer

General partnership

Answer

Joint venture

Question 2

In a limited partnership, what is the liability exposure of a limited partner who does not participate in management?

Accepted Answer

Liability limited to the amount of their capital contribution

Answer

Unlimited personal liability for all debts

Answer

Joint and several liability with the general partner

Answer

Liability only for tort claims against the partnership

Question 3

Which business entity is subject to double taxation at both the corporate and shareholder level?

Accepted Answer

C corporation

Answer

S corporation

Answer

Limited liability partnership

Answer

Sole proprietorship

Question 4

What document governs the internal operations and management structure of a corporation?

Accepted Answer

Bylaws

Answer

Operating agreement

Answer

Partnership agreement

Answer

Articles of incorporation

Question 5

Which characteristic distinguishes a joint venture from a general partnership?

Accepted Answer

Joint ventures are typically formed for a single transaction or specific project

Answer

Joint ventures have limited liability protection

Answer

Joint ventures must be registered with the SEC

Answer

Joint ventures require at least three participants

Question 6

Under the Revised Uniform Limited Liability Company Act (RULLCA), what is the default management structure of an LLC?

Accepted Answer

Member-managed by all members

Answer

Manager-managed by appointed officers

Answer

Board-managed similar to a corporation

Answer

Single managing member elected annually