Which of the Following Is True Regarding Membership Sharing of Limited

question 116

Multiple Choice

Which of the following is true regarding membership sharing of limited liability company profits and losses?

• A) Unless otherwise agreed, members share LLC profits and losses equally.
• B) Members share LLC profits and losses equally, and this distribution cannot be changed by agreement between LLC members.
• C) Unless otherwise agreed, members share LLC profits and losses proportionally, depending on the date they become members of the LLC.
• D) Members share LLC profits and losses proportionally, depending on the date they become members of the LLC, and this distribution cannot be changed by agreement between LLC members.
• E) Unless otherwise agreed, members share LLC profits and losses proportionally, depending on the value of the capital contribution members made to the LLC.

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Definitions:

Accounts Receivable Turnover

A financial ratio that measures how effectively a company collects cash from its credit sales by comparing net credit sales with the average accounts receivable.

Average Collection Period

The average amount of time it takes for a business to receive payments owed by its customers for goods or services sold on credit.

Net Sales

The total revenue from sales of goods or services, less returns, allowances for damaged or missing goods, and discounts.

Annual Interest Rate

The percentage rate charged on a loan or paid on an investment over a one-year period.