Question 1

A partner has the power to dissociate at any time by expressing the intent to withdraw.

Accepted Answer

A) True 
 B)False  True

Question 2

David, Ed, and Fred are partners in the DEF partnership.The partnership is being dissolved, having $200,000 in assets and owing $410,000 to creditors.David contributed $100,000 in capital; Ed contributed $50,000 in capital; and Fred contributed $25,000 in capital.Profits are shared equally.Which of the following is correct with regard to the responsibility of each partner under the UPA?

Accepted Answer

A) The partners will bear losses equally. 
B) The partners will bear losses in the proportion of their relative capital contributions. 
C) If Ed refuses to contribute to covering the loss and he is out of the jurisdiction, David and Fred must contribute the additional amount necessary to pay DEF's liabilities in the relative proportion of their capital contributions. 
D) Both (b) and (c). 
A) The partners will bear losses equally. 
B) The partners will bear losses in the proportion of their relative capital contributions. 
C) If Ed refuses to contribute to covering the loss and he is out of the jurisdiction, David and Fred must contribute the additional amount necessary to pay DEF's liabilities in the relative proportion of their capital contributions. 
D) Both (b) and (c). A

Question 3

General Widget's partnership assets amount to $34,000 after liquidation.Frank, Gene, and Hank, equal partners, each contributed $3,000 into the capital pool at the inception of the business.Gene later loaned the business $5,000.The partnership owes $23,000 to creditors for inventory.What will Gene get in distribution under the UPA, assuming there is no agreement on the distribution of profits?

Accepted Answer

A) $5,000. 
B) $7,000. 
C) $8,000. 
D) $11,000. 
A) $5,000. 
B) $7,000. 
C) $8,000. 
D) $11,000. B

Question 4

Absent an agreement otherwise, upon dissolution under the UPA a partner is entitled to which of the following after payment of partnership creditors?

Accepted Answer

A) A share of profits in proportion to his capital contribution. 
B) Shares of profits dependent upon the capital and time he contributed to the partnership. 
C) Repayment of his loans to the partnership, capital contribution, and a share of the profits. 
D) The UPA requires that the partners have an agreement or else they must seek a court order distributing the remaining assets. 
A) A share of profits in proportion to his capital contribution. 
B) Shares of profits dependent upon the capital and time he contributed to the partnership. 
C) Repayment of his loans to the partnership, capital contribution, and a share of the profits. 
D) The UPA requires that the partners have an agreement or else they must seek a court order distributing the remaining assets.

Question 5

If the partnership is bound by a contract, then each individual general partner has unlimited personal liability for that obligation.

Accepted Answer

A) True 
 B)False

Question 6

A partner has implied authority to:

Accepted Answer

A) hire and fire employees necessary for operation of the business. 
B) purchase property necessary for the business. 
C) receive performance of obligations due the partnership. 
D) bring legal actions to enforce claims of the partnership. 
E) All of the above. 
A) hire and fire employees necessary for operation of the business. 
B) purchase property necessary for the business. 
C) receive performance of obligations due the partnership. 
D) bring legal actions to enforce claims of the partnership. 
E) All of the above.

Question 7

David, a partner in the Speedy Delivery partnership, negligently drove his delivery truck onto the curb during a rush-hour package delivery.Marlene was injured.Against whom can Marlene collect?

Accepted Answer

A) Only David. 
B) Only the other partners. 
C) Speedy Delivery Partnership. 
D) Any partner. 
E) Both (c) and (d). 
A) Only David. 
B) Only the other partners. 
C) Speedy Delivery Partnership. 
D) Any partner. 
E) Both (c) and (d).

Question 8

Dissolution occurs upon the happening of an event specified in the partnership agreement as resulting in dissolution.However, the partners may agree to continue the business.

Accepted Answer

A) True 
 B)False

Question 9

The RUPA codifies and thus continues to give effect to the causes of dissociation and dissolution that existed under the common law, such as assignment of a partner's interest.

Accepted Answer

A) True 
 B)False

Question 10

Bernice is withdrawing from a partnership.How can she protect herself against liability on contracts the firm enters after her withdrawal?

Accepted Answer

She may protect herself by giving notice

Question 11

Upon winding up, if a partner pays more than his share of partnership losses, he has a right of contribution against the partners who have not paid their share.

Accepted Answer

A) True 
 B)False

Question 12

Define dissolution under the UPA and discuss its three causes.

Accepted Answer

The UPA defines dissolution as the chang

Question 13

Jane, Kelly, and Lois are partners in an accounting firm, but Jane intends to retire and withdraw from the partnership at the end of the year.Under the RUPA, Jane:

Accepted Answer

A) has the power to bind the partnership for a partnership obligation incurred within two years after dissociation if the partnership did not dissolve and if at the time of entering into the transaction the other party reasonably believed Jane was then a partner. 
B) is liable only for all debts incurred prior to her retirement. 
C) is liable to the firm's creditors until the day of her retirement when she will be absolved of all liability. 
D) is liable to the firm's creditors for an amount not to exceed her partnership interest on the day of her retirement. 
E) is liable to the firm's creditors for an amount not to exceed her initial capital contribution to the partnership. 
A) has the power to bind the partnership for a partnership obligation incurred within two years after dissociation if the partnership did not dissolve and if at the time of entering into the transaction the other party reasonably believed Jane was then a partner. 
B) is liable only for all debts incurred prior to her retirement. 
C) is liable to the firm's creditors until the day of her retirement when she will be absolved of all liability. 
D) is liable to the firm's creditors for an amount not to exceed her partnership interest on the day of her retirement. 
E) is liable to the firm's creditors for an amount not to exceed her initial capital contribution to the partnership.

Question 14

Under the RUPA, the partnership is liable for torts where the partner is at fault, such as negligence, trespass, fraud, or defamation, but is not liable for no-fault torts.

Accepted Answer

A) True 
 B)False

Question 15

Dissociation refers to those situations in which the RUPA requires a partnership to wind up and terminate.

Accepted Answer

A) True 
 B)False

Question 16

__________ is available to a third person to whom a representation is made and who justifiably relies on the representation.

Accepted Answer

A) Delectus personae 
B) Respondeat superior 
C) Culpable negligence 
D) Partnership by estoppel 
A) Delectus personae 
B) Respondeat superior 
C) Culpable negligence 
D) Partnership by estoppel

Question 17

Under the UPA, after dissolution:

Accepted Answer

A) the partnership must be liquidated. 
B) the remaining partners have the right to continue the partnership if the majority of them agree. 
C) the remaining partners have the right to continue the partnership if the partnership was dissolved in contravention of the partnership agreement. 
D) the partnership must be liquidated only if the dissolution was caused by the expulsion of a partner in accordance with the partnership agreement. 
A) the partnership must be liquidated. 
B) the remaining partners have the right to continue the partnership if the majority of them agree. 
C) the remaining partners have the right to continue the partnership if the partnership was dissolved in contravention of the partnership agreement. 
D) the partnership must be liquidated only if the dissolution was caused by the expulsion of a partner in accordance with the partnership agreement.

Question 18

The withdrawal of a partner in a partnership at will may be either a rightful or wrongful dissociation.

Accepted Answer

A) True 
 B)False

Question 19

The UPA provides that partners are __________ liable on all debts and contract obligations of the partnership.

Accepted Answer

A) jointly 
B) strictly 
C) jointly and severally 
D) partially 
A) jointly 
B) strictly 
C) jointly and severally 
D) partially

Question 20

"Dissolution" of a partnership and "termination"of a partnership are synonymous.

Accepted Answer

A) True 
 B)False

Exam 32: Operation and Dissolution of General Partnerships

A partner has the power to dissociate at any time by expressing the intent to withdraw.

Absent an agreement otherwise, upon dissolution under the UPA a partner is entitled to which of the following after payment of partnership creditors?

If the partnership is bound by a contract, then each individual general partner has unlimited personal liability for that obligation.

A partner has implied authority to:

David, a partner in the Speedy Delivery partnership, negligently drove his delivery truck onto the curb during a rush-hour package delivery.Marlene was injured.Against whom can Marlene collect?

Dissolution occurs upon the happening of an event specified in the partnership agreement as resulting in dissolution.However, the partners may agree to continue the business.

The RUPA codifies and thus continues to give effect to the causes of dissociation and dissolution that existed under the common law, such as assignment of a partner's interest.

Bernice is withdrawing from a partnership.How can she protect herself against liability on contracts the firm enters after her withdrawal?

Upon winding up, if a partner pays more than his share of partnership losses, he has a right of contribution against the partners who have not paid their share.

Define dissolution under the UPA and discuss its three causes.

Jane, Kelly, and Lois are partners in an accounting firm, but Jane intends to retire and withdraw from the partnership at the end of the year.Under the RUPA, Jane:

Under the RUPA, the partnership is liable for torts where the partner is at fault, such as negligence, trespass, fraud, or defamation, but is not liable for no-fault torts.

Dissociation refers to those situations in which the RUPA requires a partnership to wind up and terminate.

__________ is available to a third person to whom a representation is made and who justifiably relies on the representation.

Under the UPA, after dissolution:

The withdrawal of a partner in a partnership at will may be either a rightful or wrongful dissociation.

The UPA provides that partners are __________ liable on all debts and contract obligations of the partnership.

"Dissolution" of a partnership and "termination"of a partnership are synonymous.

Introduction to Law

Business Ethics

Civil Dispute Resolution

Constitutional Law

Administrative Law

Criminal Law

Intentional Torts

Negligence and Strict Liability

Introduction to Contracts

Mutual Assent

Conduct Invalidating Assent

Consideration

Illegal Bargains

Contractual Capacity

Contracts in Writing

Third Parties to Contracts

Performance, Breach, and Discharge

Contract Remedies

Introduction to Sales and Leases

Performance

Transfer of Title and Risk of Loss

Product Liability: Warranties and Strict Liability

Sales Remedies

Form and Content

Transfer

Holder in Due Course

Liability of Parties

Bank Deposits, Collections, and Funds Transfers

Relationship of Principal and Agent

Relationship With Third Parties

Formation and Internal Relations of General Partnerships

Limited Partnerships and Limited Liability Companies

Nature and Formation of Corporations

Financial Structure of Corporations

Management Structure of Corporations

Fundamental Changes of Corporations

Secured Transactions and Suretyship

Bankruptcy

Securities Regulation

Intellectual Property

Employment Law

Antitrust

Accountants Legal Liability

Consumer Protection

Environmental Law

International Business Law

Introduction to Property, Property Insurance, Bailments, and Documents of Title

Interests in Real Property

Transfer and Control of Real Property

Trusts and Wills

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