Question 1

Jack later regained solvency. Decide what, if anything, Charlyn gets in an action against Jack for: 
(a) one-half of the $500,000 she had paid to partnership creditors, and 
(b) one-half of $80,000, the reasonable value of Charlyn's services during the operation of the part-nership.

Accepted Answer

The answer of Jack later regained solvency. Decide what, if...

Question 2

Able, Baker, and Carr run an auto-repair business as partners. Carr, needing a little extra income, begins to repair some customer's cars on weekends in his home garage. Able and Baker have no right to any interest in this activity.

Accepted Answer

A) True 
 B)False

Question 3

RUPA generally requires the judgment creditor to exhaust the partnership's assets before going after the separate assets of a partner.

Accepted Answer

A) True 
 B)False

Question 4

For tortuous acts, the partners are said to be jointly and severally liable under both Uniform Partnership Act (UPA) and Revised Uniform Partnership Act (RUPA), and the plaintiff may separately sue one or more partners.

Accepted Answer

A) True 
 B)False

Question 5

Under UPA, "dissolution" means the termination of the partnership.

Accepted Answer

A) True 
 B)False

Question 6

Under the Uniform Partnership Act, in which of the following cases would a dissolution occur?

Accepted Answer

A)  When two partners get married. 
B)  When a case has been filed against one or more partners. 
C)  When a partner wants to leave the firm. 
D)  When a partner goes for a vacation of 15 days or more. 
E)  When a partner has mortgaged his interest against a loan from the bank.

Question 7

Ralph, a partner, doing partnership along with Gilbert and Vicky, during course of the partnership, pays a sum of $4,000 to one of the suppliers out of his personal account. The partnership firm will have to pay back this amount to Ralph as per the partner's right to _____.

Accepted Answer

A)  profits and losses 
B)  indemnification 
C)  compensation 
D)  management 
E)  derivative action

Question 8

A partner's liability for firm debts is limited to his capital contribution.

Accepted Answer

A) True 
 B)False

Question 9

Abby, Igor, Ted, and Tim operated a restaurant in partnership. Ted received a letter from his alma mater university offering him an opportunity to teach hospitality courses there. Ted always wanted to teach; he left the partnership. The firm wanted to announce that Ted was no longer their partner since Ted had been handling a lot of purchases and dealing with some big customers. Which of the following statements could they file in order to do so?

Accepted Answer

A)  Statement of partnership authority 
B)  Statement of dissolution 
C)  Statement of dissociation 
D)  Statement of denial 
E)  Statement of liquidation

Question 10

Partnerships may be dissolved only by unanimous agreement among the partners.

Accepted Answer

A) True 
 B)False

Question 11

a. Dubious brought an action against Brown as co-partner. Who wins? 
b. George brought an action against Brown as co-partner. Who wins?

Accepted Answer

The answer of a. Dubious brought an action against Brown...

Question 12

Under the Uniform Partnership Act (UPA), dissolution of a partnership is said to be by the operation of law when:

Accepted Answer

A)  the partnership is at will and a partner wants to leave the organization. 
B)  the entire partnership becomes bankrupt. 
C)  the term of the partnership agreement has expired. 
D)  all the partners decide that it is preferable to dissolve than to continue. 
E)  the partners decide to discharge a partner though no provision permits them to do so.

Question 13

Under the Revised Uniform Partnership Act (RUPA), a partner is entitled to remuneration for all the services performed by him for the partnership.

Accepted Answer

A) True 
 B)False

Question 14

The Revised Uniform Partnership Act (RUPA) uses the term _____ in lieu of the Uniform Partnership Act (UPA) term "dissolution."

Accepted Answer

A)  winding up 
B)  liquidation 
C)  termination 
D)  dissociation 
E)  dilution

Question 15

The worst aspect of partnerships is

Accepted Answer

A)  the difficulty in forming them. 
B)  the decisions about control and compensation. 
C)  the possibility that a partner might be personally liable for firm obligations. 
D)  that the firm's books and records must be made publicly available annually. 
E)  that firm profits are taxed twice: once to the firm, and again to the partners when they get distributions.

Question 16

The duty owed by a partner to her co-partners is the same as the duty owed by an agent to a principal.

Accepted Answer

A) True 
 B)False

Question 17

The _____ states that a business entity does not itself owe taxes on income; it only acts as a pass-through for its members to receive income.

Accepted Answer

A)  conduit theory 
B)  estoppel theory 
C)  entity theory 
D)  concession theory 
E)  aggregate theory

Question 18

Under Revised Uniform Partnership Act (RUPA), dissolution happens when RUPA requires the partnership to wind up and terminate.

Accepted Answer

A) True 
 B)False

Question 19

The Uniform Partnership Act and the Revised Uniform Partnership Act do not dictate what relations among partners must be.

Accepted Answer

A) True 
 B)False

Question 20

An old partner cannot be liable for partnership obligations incurred after she left the partnership.

Accepted Answer

A) True 
 B)False

Exam 41: Partnership Operation and Termination

Jack later regained solvency. Decide what, if anything, Charlyn gets in an action against Jack for: (a) one-half of the $500,000 she had paid to partnership creditors, and (b) one-half of $80,000, the reasonable value of Charlyn's services during the operation of the part-nership.

Able, Baker, and Carr run an auto-repair business as partners. Carr, needing a little extra income, begins to repair some customer's cars on weekends in his home garage. Able and Baker have no right to any interest in this activity.

RUPA generally requires the judgment creditor to exhaust the partnership's assets before going after the separate assets of a partner.

For tortuous acts, the partners are said to be jointly and severally liable under both Uniform Partnership Act (UPA) and Revised Uniform Partnership Act (RUPA), and the plaintiff may separately sue one or more partners.

Under UPA, "dissolution" means the termination of the partnership.

Under the Uniform Partnership Act, in which of the following cases would a dissolution occur?

Ralph, a partner, doing partnership along with Gilbert and Vicky, during course of the partnership, pays a sum of $4,000 to one of the suppliers out of his personal account. The partnership firm will have to pay back this amount to Ralph as per the partner's right to _____.

A partner's liability for firm debts is limited to his capital contribution.

Partnerships may be dissolved only by unanimous agreement among the partners.

a. Dubious brought an action against Brown as co-partner. Who wins? b. George brought an action against Brown as co-partner. Who wins?

Under the Uniform Partnership Act (UPA) , dissolution of a partnership is said to be by the operation of law when:

Under the Revised Uniform Partnership Act (RUPA), a partner is entitled to remuneration for all the services performed by him for the partnership.

The Revised Uniform Partnership Act (RUPA) uses the term _____ in lieu of the Uniform Partnership Act (UPA) term "dissolution."

The worst aspect of partnerships is

The duty owed by a partner to her co-partners is the same as the duty owed by an agent to a principal.

The _____ states that a business entity does not itself owe taxes on income; it only acts as a pass-through for its members to receive income.

Under Revised Uniform Partnership Act (RUPA), dissolution happens when RUPA requires the partnership to wind up and terminate.

The Uniform Partnership Act and the Revised Uniform Partnership Act do not dictate what relations among partners must be.

An old partner cannot be liable for partnership obligations incurred after she left the partnership.