Question 1

Assuming that the information contained in a registration statement is complete and accurate, the registration statement becomes effective:

Options :

A : 10 days after receipt by the SEC

B : 20 days after receipt by the SEC

C : 30 days after receipt by the SEC

D : only after the SEC specifically clears the issue in writing to the principal underwriter

Answer: D

Question 2

Which of the following activities by a limited partner may subject the partner to unlimited liability?

Options :

A : participating in management of the partnership

B : committing the partnership in any manner

C : making loans beyond those specified in the partnership agreement

D : all of the above

Answer: D

Question 3

A financial institution requesting a quote on a block of 100 bonds from a dealer ingovernment securities receives a quote of 98.02 bid, 98.06 asked.What is the dollar amount the institution will receive if the financial institution sells thesebonds to the dealer?’’

Options :

A : $98,062.50

B : $98,187.50

C : $98,250.00

D : $98,750.00

Answer: A

Question 4

Bubba is age 54 and has investments in a retirement plan with his former employer valuedat $104,500. Bubba withdraws $25,000 to open a retail clothing store.Which of the following statements is true regarding Bubba’s tax consequences?

Options :

A : the entire account is terminated and $104,500 is immediately taxable

B : a penalty of 10% of the withdrawn amount is assessed

C : a penalty of 10% on all assets in Bubba’s account is assessed

Answer: B

Question 5

On which of the following is depreciation permitted?

Options :

A : rental property whose value is declining

B : residential property not used for business

C : property whose maintenance exceeds the investment credit

D : equipment subject to recapture

Answer: B

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