A Bonus May Be Paid in All of the Following

Multiple Choice

A bonus may be paid in all of the following situations except:

A) By a new partner when the current value of a partnership is greater than the recorded amounts of equity.
B) By a withdrawing partner to remaining partners if the recorded value of the equity is overstated.
C) To a new partner with exceptional talents.
D) By remaining partners to a withdrawing partner if the recorded equity is understated.
E) By an existing partner to him or herself when in need of personal cash flow.