Which of following is true about the capital contributions of members to an LLC?
a) Capital contributions must be made in the form of Cash.
b)An unfulfilled promise to make a capital contribution is generally unenforceable.
c)Members are required to make equal contributions in order to maintain their limited liability.
d)A promise by a member to contribute services is excused if the member is unable to perform the particular services promised.
e)A member who promised to make a capital contribution is not discharged from the promise if the member dies without having made the contribution.
i beleive it is b, because partnership should be about each other advantages. what you think
To determine which of the options is true about the capital contributions of members to an LLC, let's examine each option and its validity:
a) Capital contributions must be made in the form of Cash: This statement is not necessarily true. While cash is a common form of capital contribution, it is not the only accepted form. Members can contribute assets, property, or services as well, depending on the agreements outlined in the LLC's operating agreement.
b) An unfulfilled promise to make a capital contribution is generally unenforceable: This statement is true. Generally, a mere promise by a member of an LLC to make a capital contribution is unenforceable unless it is supported by a separate legally binding agreement.
c) Members are required to make equal contributions in order to maintain their limited liability: This statement is not necessarily true. The contributions of members in an LLC do not have to be equal. The specific contribution requirements are typically determined by the operating agreement, which may allow for differential contributions based on agreed-upon terms.
d) A promise by a member to contribute services is excused if the member is unable to perform the particular services promised: This statement is not true. A promise by a member to contribute services cannot be excused merely because the member is unable to perform the specific services promised. If a member commits to providing services, they are generally expected to fulfill their obligations unless otherwise agreed upon.
e) A member who promised to make a capital contribution is not discharged from the promise if the member dies without having made the contribution: This statement is generally true. Unless otherwise specified in the operating agreement, the death of a member does not discharge the member's obligation to make a promised capital contribution.
Based on the explanations above, option b) "An unfulfilled promise to make a capital contribution is generally unenforceable" is indeed the correct answer.