Statement 1 – The retirement or withdrawal of a partner from a partnership requires termination of the business; Statement 2 – When a partner retires from a partnership, he or she is personally liable for any partnership debts incurred after the retirement. a. Only Statement 1 is correct b. Only Statement 2 is correct c. Both Statements are correct d. Both Statements are incorrect

Statement 1 – The retirement or withdrawal of a partner from a partnership requires termination of the business; Statement 2 – When a partner retires from a partnership, he or she is personally liable for any partnership debts incurred after the retirement. a. Only Statement 1 is correct b. Only Statement 2 is correct c. Both Statements are correct d. Both Statements are incorrect

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

A Ooredoo l. A sct.edu.om P Flag question Which of the following adjustments are NOT to be done at the time of retirement of a partner? a. Preparation of Executors account in case of death of a partner b. Accounting treatment of goodwill to be made c. Reserves and profits to be adjusted d. New profit sharing ratio of remaining partners. The correct answer is: Reserves and profits to be adjusted II
S1: When two or more proprietors form a partnership, one may maintain his own books as the partnership books. Accordingly, only the other partners need to adjust and close their accounts. S2: When one of the partners retain his books as the books of the partnership, still, he should also close his accounts and record his investments both statements are true both are false only S1 is true only S2 is true.
NOTE AI ANSWER EXPERT SOLUTION
A partnership liquidation occurs when O a. the assets are sold, liabilities paid, and business operations terminated O b. the ownership interest of one partner is sold to a new partner O c. a new partner is admitted O d. a partner dies
A partner who does not take active part in the business and is not known to be a partner O A. Dormant partner B. Retiring partner C. Sub-partner D. Ostensible partner
Identify the correct statement/s from the following:I. In absence of partnership agreement, no interest on capital is allowed II. In absence of partnership agreement, 6% interest on partner's loan is allowed O a. Statement II only correct O b. Statement I only correct O c. Both Statements are correct O d. Both Statements are wrong
Hi, can someone help me with this question please?
PB3. LO 15.5 Match each of the following descriptions with the appropriate term related to partnership accounting. A. Each and every partner can enter into contracts on behalf of the partnership i. liquidation B. The business ceases operations. ii. capital deficiency C. How partners share in income and loss iii. admission of a new partner D. Adding a new partner by contributing cash iv. mutual agency E. A partner account with a debit balance v. income sharing ratio
Question 2 Which of the following are imposed rules on general partnerships? Each general partner is considered to be an agent for the partnership and for each partner, as long as the partner is acting in a business-related matter. Each general partner is personally liable, without limit, for torts or contracts if the partnership has insufficient assets to cover the debt or liability. Each general partner is expected to devote service only to the partnership and not to any competing business ventures. O All of the above.
Answer the following questions: 1.What is dissolution of a partnership? During dissolution of partnership, is the partnership terminated? Art. 1828 and 1829 2. What causes dissolution Of a partnership? Art. 1830 3. After the dissolution of the partnership, how will the assets of the partnership be liquidated and accounted for? Alt. 1839
PARTNERSHIP DISSOLUTION True or False _______1. Insolvency, insanity, or incapability to perform by a partner may cause the dissolution of the firm. _______2. Dissolution and liquidation mean the same thing. _______3. Asset revaluation may be recognized for the current partners when the new equity is greater than the original partners' equity. _______4. Dissolution may not necessarily change the basic function or operation of the partnership. _______5. Dissolution always immediately causes the termination of a firm. _______6. An admission of a new partner causes a change in the ownership interest of the original partners. _______7. Ownership may be transferred at will by anyone partner without consulting the other partners. _______8. Bonus is, in effect, transfer of capital from one partner to another partner. _______9. Recognizing undistributed profit or loss share of the partners at dissolution date is necessary in effecting dissolution. _______10. ABC Partnership decided to admit D…
7 Which of the following rules apply/s in case of absence of partnership deed? a. No interest on capital Only b. No salaries and No interest on capital c. None of the options d. No salaries Only Clear my choice