Mgmt 211 Exam 4

Front 1

Factors in deciding type of business entity

Back 1

1. ease of operation

2. desired length of existence

3. personal liability

4. taxation

5. ease of sale of business

6. ease of raising capital

Front 2

Disadvantages to Sole Proprietorship

Back 2

1. unlimited liability

2. difficulty raising capital

3. difficulty in selling the business

Front 3

Advantages to Sole Propriotership

Back 3

1. Ease of operation

2. Single taxation

3. No formalities to open

Front 4

Disadvantages to partnership

Back 4

1. Unlimited liability to all partners' actions

Front 5

Advantages to partnership

Back 5

1. Easier to raise capital

Front 6

Advantages to corporation

Back 6

1. Separate legal entity - limited liability

2. Easier to raise capital

Front 7

Disadvantages to corporation

Back 7

1. double taxation

Front 8

Limited Partnership

Back 8

Created by state statute, partners must file a Certificate of Limited Partnership, must be two classes of partners

Front 9

Advantages of limited partnership

Back 9

1. Easier to raise capital

2. Limited partners have limited liability

Front 10

disadvantages of limited partnership

Back 10

1. limited partners cannot be involved in management

2. general partners have unlimited liability

Front 11

Closely held corporations

Back 11

"family corps", "privately held corps". Corporation created under state statute, shares held by a small number of people such as a family, not traded to the public, generally operated like a sole proprietorship/partnership that takes advantage of limited liability.

Front 12

Advantages of closely held corporations

Back 12

1. limited liability

Front 13

disadvantages of closely held corporations

Back 13

1. double taxation

2. must follow all steps of corporate structure

Front 14

How to qualify as an S Corporation

Back 14

1. corp must be domestic

2. shareholders can only be individuals

3. can have no more than 100 shareholders

4. can only be one class of shareholders

5. sharholders cannot be illegal aliens

Front 15

advantages of an S corp

Back 15

1. single taxation

2. limited liability

Front 16

disadvantages of an S corp

Back 16

1. IRS has strict requirements and can change them anytime

Front 17

Professional corporation

Back 17

used by professionals to take advantage of limited liability

Front 18

advantages of professional corporation

Back 18

1. limited liability

Front 19

disadvantages of professional corporation

Back 19

1. double taxation

Front 20

Creation of an LLC

Back 20

Created by Articles of Organization (Articles of Formation in Texas):

1. "LLC" has to be in company name

2. Period of duration (can be perpetual)

3. Purpose of LLC

4. Address & name of registered agent

5. Statement of managers/owners

6. Name & Address of each organizer

Front 21

Structure of an LLC

Back 21

Owners - called members, unlimited amount, can be individuals or not

Operating Agreement/Company Agreement/Company Regulations - specify the division of income to members, how membership is transferred, what happens upon dissolution

Front 22

Governance of an LLC

Back 22

member-managed - governed by members

manager-managed - governed by agents for the LLC, takes members right/responsibility to manage away,

Front 23

Dissolution of an LLC

Back 23

1. when the duration expires

2. occurrence of specific events in the operation agreement

3. actions of members to dissolve

4. when LLC has no members

5. entry of a decree of judicial dissolution

Articles of Dissolution are to be filed, receive Certificate of Dissolution

Front 24

Advantages of an LLC

Back 24

1. limited liability

2. easier to operate than corporation

3. shareholder meetings etc not required

4. single taxation

5. flexibility in management

6. no limit on number or who can be members

Front 25

Disadvantages of an LLC

Back 25

1. LLC laws not uniform

2. Victim of "unknown" in court dealings

Front 26

Limited Liability Partnership advantages

Back 26

1. partners usually have limited liability

2. LLP is a separate entity

3. all partners can take part in management

Front 27

limited liability limited partnership

Back 27

type of limited partnership that tries to combine LP and LLP. General partner has the same liability as a limited partner. Use has been limited and mostly untested

Front 28

The first general incorporation law

Back 28

Gave anyone who met certain basic requirements the right to incorporate for any lawful purpose

Front 29

Clean Air Act

Back 29

focus on air pollution. Developed air quality standards called NAAQS set at two levels: humans, then vegetation, climate, etc. Responsibility of states to enforce with SIP, AQCRs, attainment/non-attainment areas.

Front 30

NAAQS stands for

Back 30

national ambient air quality standards, for the Clean Air Act

Front 31

SIP stands for

Back 31

state implementation plan, for the Clean Air Act

Front 32

AQCR stands for

Back 32

air quality control regions, for the Clean Air Act

Front 33

RACT stands for

Back 33

reasonably available control technology, for the Clean Air Act under stationary sources of air pollution. Normally required of existing sources.

Front 34

BACT stands for

Back 34

best available control technology, for the Clean Air Act under stationary sources of air pollution. Normally required of new sources.

OR

for Clean Water Act, under point sources.

Front 35

BPCT stands for

Back 35

best practical control technology, for Clean Water Act, under point sources.

Front 36

Marine Protection, Research, and Sanctuaries Act of 1972

Back 36

called Ocean Dumping Act. requires permit to dump in ocean.

Front 37

OPA stands for

Back 37

oil protection act

Front 38

oil protection act

Back 38

in response to Exxon Valdez accident in Alaska. Requires tankers to be double hulled by 2015, met with opposition. Administered by US Coast Guard. civil penalties by barrel or time