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Exam 27: All Forms of Partnership

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Question 1

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A partner may dissociate from a partnership by declaring bankruptcy..

A) True
B) False

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Question 2

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Jim and Kyle are partners in J&K Sales, which exports technical equipment under a three-year partnership agreement. The U.S. government declares that the equipment can no longer be exported. J&K

A) dissolves as soon as the stated term expires.
B) dissolves as soon as the partners agree to dissolve it.
C) dissolves immediately unless the partners change its business.
D) does not dissolve.

E) A) and B)
F) B) and D)

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Question 3

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In a limited partnership, a limited partner has full responsibility for the partnership and for all its debts.

A third party cannot sue one of the partners of a partnership without suing all of the partners of the partnership.

A partner's profit from a partnership is taxed as income to the firm.

Guy and Hanna do business as G-H Associates. If G-H is a partnership, it is governed by the Uniform Partnership Act

A partner is entitled to make secret profits or put self-interest before his or her duty to the interest of the partnership.

A partnership agreement can include almost any terms that the partners wish.

For most purposes, the law recognizes a partnership as an independent entity.

In a general partnership, the partners are personally liable for the debts of the partnership.

If a partnership's liabilities are greater than its assets, the partners bear the losses.

Partnership profits must be shared in the same proportion as the partners' investment of capital in the firm.

Newt is considering forms of business organization for Newton Design, an architectural firm. An advantage of a limited liability partnership is that partners can avoid personal liability for

Fact Pattern 27-1 Brad, Carlos, and Dora are general partners in Eastside Physicians, a medical clinic. -Refer to Fact Pattern 27-1. Brad, Carlos, and Dora decide to admit Faisal as a new partner in Eastside Physicians. Faisal's liability for partnership debts incurred before his admission is

In a general partnership, the acts of one partner in the ordinary course of business subjects both the partner and the firm to liability.

Fact Pattern 27-1 Brad, Carlos, and Dora are general partners in Eastside Physicians, a medical clinic. -Refer to Fact Pattern 27-1. Brad's dissociation from the firm results in

Ben, who runs a livestock breeding business, owes the Circle C Ranch $40,000. Ben agrees to pay the Circle C a percentage of his profits each month until the debt is paid. Because of this agreement, the Circle C is

Property acquired by the partnership is the property of the partners individually.

Tom and Bill are partners in Tough Trucks Towing. James is not a partner. In dealing with Fred, James holds himself out to be a partner in Tough Trucks Towing and Fred contracts to have Tough Trucks Towing tow some vehicles for him. If Tough Trucks fails to tow the vehicles, a court may conclude that

An assignment of the interest of a limited partner dissolves a limited partnership.