Assignment
Question 1
Which of the following is not a characteristic of a general partnership?
a The partners have limited liability.
b Each partner is an agent of the partnership for transactions to carry on in the ordinary course of the partnership business.
c All partners are liable jointly and severally for all obligations of the partnership unless otherwise provided by law.
d Corporations or other partnerships are co-owners of a partnership.
Question 2
What is the single model used for partnership law?
a generally accepted accounting principles
b Certified Partnership Association
c Uniform Partnership Act
d none of the above
Question 3
Assume that Able and Bart both have a $50,000 interest in a partnership. Now Curt buys Able's share for $60,000. What is the entry in the partnership books for this transaction?
a DR - cash $60,000 DR capital-Curt
b DR - capital-Able $50,000 CR capital-Curt $50,000
c DR - capital-Able $60,000 CR capital-Curt $60,000
d none of the above
Question 4
Which of the following have partners that are joint personally liable for each other's acts?
a general partnership
b limited partnership
c limited liability partnership
d none of the above
Question 5
In forming a partnership, Allan contributed 60% of the net assets, Brown contributed 40% and Curt contributed no assets. However, Curt has special expertise in the business undertaken by the partnership. In recognition of this fact, the partnership agreement specifies that Curt is entitled to 10% of the net assets of the business. Profits and losses are shared based upon capital balances. Under the agreement, Allan's capital share is:
a 36%
b 40%
c 50%
d 54%
Question 6
Which statements are prepared for partnerships?
a balance sheet
b income statement
c statement of cash flows
d all of the above
Question 7
What is the single model used for partnership law?
a generally accepted accounting principles
b Certified Partnership Association
c Unified Partnership Association
d none of the above
Question 8
In forming a partnership, Allan contributed 60% of the net assets, while Brown contributed 40%. However, Brown has special expertise in the business undertaken by the partnership. In recognition of this fact, the partnership agreement specifies that Brown is entitled to an additional 10% of the net assets of the business. Under the agreement, Allan's capital share is:
a 40%
b 50%
c 60%
d 70%
Question 9
In forming a partnership, Allan contributed 60% of the net assets, Brown contributed 40% and Curt contributed no assets. However, Curt has special expertise in the business undertaken by the partnership. In recognition of this fact, the partnership agreement specifies that Curt is entitled to 10% of the net assets of the business. Profits and losses are shared based upon capital balances. Under the agreement, Brown's capital share is:
a 36%
b 40%
c 50%
d 54%
Question 10
Which of the following are steps required to determine a new partner's capital account balance?
a receive contribution from new partner
b determine the amount of contribution retained by current partners
c determine the amount of bonus paid to current partners or new partner
d all of the above.