Which of the following is true about a partnership? The old partnership ends only upon the withdrawal of a partner. The old partnership ends upon the acceptance of a new partner. If a new partner is admitted to the partnership, the old partnership must liquidate. Partnerships have an unlimited life. Only one owner is allowed in a Partnership.

Which of the following is true about a partnership? The old partnership ends only upon the withdrawal of a partner. The old partnership ends upon the acceptance of a new partner. If a new partner is admitted to the partnership, the old partnership must liquidate. Partnerships have an unlimited life. Only one owner is allowed in a Partnership.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter15: Partnership Accounting

Section: Chapter Questions

Problem 12Q: When a partnership liquidates, do partners get paid first or do creditors get paid first?

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Question

Which of the following is true about a partnership?

The old partnership ends only upon the withdrawal of a partner.
The old partnership ends upon the acceptance of a new partner.
If a new partner is admitted to the partnership, the old partnership must liquidate.
Partnerships have an unlimited life.
Only one owner is allowed in a Partnership.

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

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