Question 1

A partner always has the power to dissociate from the partnership.

Accepted Answer

A) True 
 B)False

Question 2

Resort Gift Shop is operated as a partnership, with five partners. Shan has a one-third interest in the firm. Each of the other partners has a one-sixth interest. Ted is the senior partner. With respect to management decisions

Accepted Answer

A)  a majority of the partners must agree. 
B)  Shan rules. 
C)  Ted decides. 
D)  unanimous consent is required. 
A)  a majority of the partners must agree. 
B)  Shan rules. 
C)  Ted decides. 
D)  unanimous consent is required.

Question 3

Olav starts Power Cells to make and sell batteries. Later, Olav contracts with Quinn to invest additional capital in the firm in exchange for 25 percent of the profits. Olav and Quinn agree that Olav will continue to control the business. Olav and Quinn are not partners in Power Cells because

Accepted Answer

A)  they do not share the profits equally. 
B)  their agreement does not provide for the sharing of losses. 
C)  Olav started the firm before Quinn agreed to invest additional capital. 
D)  they do not have joint control over the business. 
A)  they do not share the profits equally. 
B)  their agreement does not provide for the sharing of losses. 
C)  Olav started the firm before Quinn agreed to invest additional capital. 
D)  they do not have joint control over the business.

Question 4

Nora and Owen do business as Property & Profit, a real estate investment partnership. In acting on the firm's behalf, Nora takes advantage of an opportunity to make a secret profit. To her firm, Nora is liable for a breach of

Accepted Answer

A)  the duty of care. 
B)  contract. 
C)  the duty of loyalty. 
D)  none of the choices. 
A)  the duty of care. 
B)  contract. 
C)  the duty of loyalty. 
D)  none of the choices.

Question 5

Otto is a limited partner in Port Exports, a limited partnership. By participating in the firm's management, Otto is liable for its obligations

Accepted Answer

A)  in proportion to the number of partners in the firm. 
B)  to no extent. 
C)  to the extent of his capital contribution to the firm. 
D)  to the full extent. 
A)  in proportion to the number of partners in the firm. 
B)  to no extent. 
C)  to the extent of his capital contribution to the firm. 
D)  to the full extent.

Question 6

In a limited partnership, every partner has full responsibility for the management of the partnership and its obligations.

Accepted Answer

A) True 
 B)False

Question 7

Glen is a partner in Home Builders, a construction firm. Glen's assignment of his interest in the partnership to Investment Consultants results in

Accepted Answer

A)  nothing with respect to Home Builders. 
B)  the automatic termination of Home Builders' legal existence. 
C)  Glen's liability for all of Home Builders' debts. 
D)  Glen's wrongful dissociation and liability for any damages. 
A)  nothing with respect to Home Builders. 
B)  the automatic termination of Home Builders' legal existence. 
C)  Glen's liability for all of Home Builders' debts. 
D)  Glen's wrongful dissociation and liability for any damages.

Question 8

Regardless of the partners' consent or agreement, the voluntary dissociation of a partner begins the dissolution of the partnership.

Accepted Answer

A) True 
 B)False

Question 9

The Uniform Partnership Act governs the operation of partnerships in spite of a different agreement among the partners.

Accepted Answer

A) True 
 B)False

Question 10

One of the essential elements of a partnership is good faith.

Accepted Answer

A) True 
 B)False

Question 11

A partner always has the right to dissociate from the partnership.

Accepted Answer

A) True 
 B)False

Question 12

Del and Efron want to form a limited partnership to do general business bookkeeping with an emphasis on tax accounting. In most states, a limited partnership will be created when Del and Efron

Accepted Answer

A)  file a certificate of limited partnership. 
B)  execute a partnership agreement. 
C)  accept their first client. 
D)  make their capital contributions. 
A)  file a certificate of limited partnership. 
B)  execute a partnership agreement. 
C)  accept their first client. 
D)  make their capital contributions.

Exam 31: All Forms of Partnership

A partner always has the power to dissociate from the partnership.

Resort Gift Shop is operated as a partnership, with five partners. Shan has a one-third interest in the firm. Each of the other partners has a one-sixth interest. Ted is the senior partner. With respect to management decisions

Olav starts Power Cells to make and sell batteries. Later, Olav contracts with Quinn to invest additional capital in the firm in exchange for 25 percent of the profits. Olav and Quinn agree that Olav will continue to control the business. Olav and Quinn are not partners in Power Cells because

Nora and Owen do business as Property & Profit, a real estate investment partnership. In acting on the firm's behalf, Nora takes advantage of an opportunity to make a secret profit. To her firm, Nora is liable for a breach of

Otto is a limited partner in Port Exports, a limited partnership. By participating in the firm's management, Otto is liable for its obligations

In a limited partnership, every partner has full responsibility for the management of the partnership and its obligations.

Glen is a partner in Home Builders, a construction firm. Glen's assignment of his interest in the partnership to Investment Consultants results in

Regardless of the partners' consent or agreement, the voluntary dissociation of a partner begins the dissolution of the partnership.

The Uniform Partnership Act governs the operation of partnerships in spite of a different agreement among the partners.

One of the essential elements of a partnership is good faith.

A partner always has the right to dissociate from the partnership.

Del and Efron want to form a limited partnership to do general business bookkeeping with an emphasis on tax accounting. In most states, a limited partnership will be created when Del and Efron

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