Who owns it?
Lawsuits
Why it's a great idea
Why it's a bad idea
Terminology
100

Owners of this type of entity are called Members

LLC

100

The term for a lawsuit when a share¬≠holder sues on behalf of a corporation 

Derivative suit

100

This type of entity does not allow foreign investors to be owners

Partnerships

100

This type of entity has more requirements and required processes than other options

Corporation

100

A corporation or LLC formed outside of a state's jurisdiction

foreign corporation or LLC

200

Owners of this type of entity are called Shareholders

Corporations

200

Damages awarded in a shareholder derivative suit are awarded to this party

The corporation

200

This type of entity combines the limited liability aspects of a corporation with the tax advantages of a partnership

LLC

200

In some states, this type of entity is not an option for professionals forming an entity 

LLC

(May have to form as a professional corporation or professional limited liability partnership)

200

When a court the ignores the business structure and imposes personal liability on the owners

Piercing the corporate veil

300

This type of entity allows foreign investors to be owners

LLC

300

This entity can be sued in every state of which their owners are citizens

LLC

300

If you want to go public (e.g. launch on IPO on the NYSE or NASDAQ), this is the entity you want to choose

Corporation

300

Owners of this type of entity may be unable to move litigation to federal courts under diversity of citizenship

LLCs

(b/c the LLC can be sued in any state where Members are citizens, reducing availability of federal courts under diversity of citizenship)

300

When LLC members designate a person or group of persons to manage the firm

Manager-managed

400

The term for ownership interests in a corporation

Shares

400

In Hodge v. Stongbuilt, this type of entity allowed the D to avoid personal liability in a products liability suit

LLC

400

*The liability exposure of an owner of this type of entity is limited to the amount of that owner's investment 

* 3 possible correct answers

LLC, Corporation, Limited Partnership

400

Fewer than than 1/5 of the states have adopted the model code for this type of entity, which create legal  unpredictability across the states

LLC

400

An event that will lead to a Member's dissociation

A triggering event

500

The term for ownership interests in an LLC

Membership interests

500

The courts can treat this type of corporation like partnerships and hold each professional liable for malpractice committed within the scope of the business by others in the firm. 

Professional corporation (P.C.)

500

This entity offers more uniformity, because most states have adopted the model code

Corporation

500

In this type of entity, the owners will have joint liability for the acts of the entity

Partnership

500

Corporate earnings that are not distributed as dividends

Retained earnings

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