A, one of the partners in the ABC Partnersh decided to buy the share of B in the partnership. Which of the following statements is not true? O There is no need to revise the partners' equity O Partners' equity in total amount will not chang O Partnership assets will remain the same. O Partnership profit and loss ratio will change.

A, one of the partners in the ABC Partnersh decided to buy the share of B in the partnership. Which of the following statements is not true? O There is no need to revise the partners' equity O Partners' equity in total amount will not chang O Partnership assets will remain the same. O Partnership profit and loss ratio will change.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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In a partnership, a capital deficiency occurs for a partner when Options: • His share in the losses of the partnership is more than his capital balance • Loan payable by the partnership to him greater than his capital balance • His solvency is lesser than his capital balance • His personal assets are less than his personal liabilities
Which of the following is true regarding capital deficiencies? O a Ob Oc Od The partners do not have a legally enforceable claim against the partner with the capital deficiency. If a partner with a capital deficiency is unable to pay the amount owed to the partnership, the partners with debit balances must absorb the loss. The loss is allocated based on the profit and loss ratios between the partners whether with credit or debit balances. if the partner with the capital deficiency pays the amount owed to the partnership, the deficiency is eliminated.
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A Moving to another question will save this response. Question 1 When a new partner is added to an existing partnership, the underlying business operations must close and reopen. O True False A Moving to another question will save this response.
one who is limited as to how many partnerships he or she can a partner When a partner chooses to leave a partnership and the business continues with the remaining partners, this is called O dissociation O dissolution O disillusion O depression
No need to explain. The following events dissolve a partnership except: a. admission of a partner b. change of the partnership name c. conversion of a partnership to a corporation d. impairment of partnership assets Before dissolution takes effect, liabilities should be restated at their a. fair market values b. present values c. liquidating values d. historical values
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The profit and loss from revaluation on retirement of partner is shared by? O a. All the partners O b. The remaining partners O c. None of these are correct. O d. Only retiring partner
According to the RUPA, a new partner is admitted to a partnership if a majority of the partners consent. TRUE OR FALSE Which of the following refers to the sale of the partnership’s assets during the winding up process? Multiple Choice Destruction. Termination. Dissociation. Elimination. Liquidation.