FREE CLA/CP Business Organization Types Questions and Answers Flashcards
6 cards from real CLA/CP Exam practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 FREE CLA/CP Business Organization Types Questions and Answers flashcards as text
Which type of business organization requires filing articles of organization with the state?
Answer: Limited liability company (LLC)
An LLC is formed by filing articles of organization with the appropriate state agency.
In a limited partnership, what is the liability exposure of a limited partner who does not participate in management?
Answer: Liability limited to the amount of their capital contribution
A limited partner's liability is restricted to the amount they have invested in the partnership.
Which business entity is subject to double taxation at both the corporate and shareholder level?
Answer: C corporation
A C corporation pays taxes on its income, and shareholders pay taxes again on dividends received.
What document governs the internal operations and management structure of a corporation?
Answer: Bylaws
Corporate bylaws establish the rules for internal governance, meetings, officer duties, and decision-making.
Which characteristic distinguishes a joint venture from a general partnership?
Answer: Joint ventures are typically formed for a single transaction or specific project
A joint venture is generally created for a specific, limited business purpose rather than an ongoing enterprise.
Under the Revised Uniform Limited Liability Company Act (RULLCA), what is the default management structure of an LLC?
Answer: Member-managed by all members
Under RULLCA, the default management structure is member-managed unless the operating agreement specifies otherwise.