1. Under a general partnership, each partner is considered an agent of a general partnership and is liable for:
A) The debts of the business
B) The taxes on their share of the income
C) The acts of the other partners
D) All of the above
2. As a part of the initial investment in forming a partnership, a partner contributes office equipment that had a cost of $20,000, and accumulated depreciation of $12,500. If the partners deem the market value to be $9,000, what amount should be debited to the office equipment account?
A) $7,500
B) $9,000
C) $12,500
D) $20,000
3. Lee and Stills are partners who share income in the ratio of 2:1 and who have capital balances of $65,000 and $35,000 respectively. If Mor, with the consent of Stills, acquired A??1 of Lee's interest for $40,000 for what amount would Mor's capital account be credited?
A) $32,500
B) $40,000
C) $50,000
D) $72,500
4. Chip and Dale agree to form a partnership by verbal agreement and a hand shake. Chip is to contribute $50,000 in assets and devote A??1 time in the partnership. Dale is to contribute $20,000 and devote full time to the partnership. How will Chip and Dale split the net income/loss?
A) 5:2
B) 1:2
C) 1:1
D) 2.5:1
5. Henry and Thomas share gains and losses in the ratio of 2:1. They decide to dissolve their partnership and after selling all assets for cash and paying all liabilities, the cash account has $12,000 in it. The capital accounts were as follows: Henry, $10,000; Thomas, $2,000. How much of the $12,000 cash would Henry receive?
A) $2,000
B) $8,000
C) $10,000
D) $12,000