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Partnership and Business Law

1,019 Questions

Test your knowledge of partnership regulations and business law with these practice questions. The topics include the rights of minor partners, firm dissolution, retirement rules, and public notices. This material is crucial for law exams and legal studies.

Rights of minor partnersPublic notice requirementsFirm dissolution rulesPartner retirementHolding out partner principlePartnership deed provisions

Partnership and Business Law Questions

Multiple choice

Registration of partnership is _____ in India.

  1. compulsory

  2. optional

  3. obligatory

  4. desirable
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

It is not compulsory to register a partnership firm in India, though it is advisable that the firm should register itself.

Multiple choice

A new partner can be admitted as a partner

  1. with consent from majority of partners

  2. with consent from all the partners

  3. if he/she is a representative of old partner

  4. if he has purchased the old partner's shares
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A new partner can be admitted only if all the partners give consent to it.

Multiple choice

Which of the following relationships forms ___partnership?

  1. a money lender sharing a part of profits in addition to interest.

  2. an agent getting a share in addition to his commission.

  3. widow of a partner getting annuity from firm.

  4. sharing of profits between two college friends carrying a part time business.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

It does not matter whether the business is part time or full time. The sharing of profits constitutes an element of partnership. All others are though getting a part of profits, but are not partners.

Multiple choice

Partnership arises from

  1. status

  2. contract

  3. law

  4. birth
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Partnership always arises from a contract between two or more parties. Co-ownership arises from status. A company is created by law.

Multiple choice

Registration of partnership is _____ in India.

  1. compulsory

  2. optional

  3. obligatory

  4. desirable
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

It is not compulsory to register a partnership firm in India, though it is advisable that the firm should register itself.

Multiple choice

Which of the following is not an effect of non-registration of a firm?

  1. No suit by partner against firm to enforce his rights.

  2. No suit against any other partner.

  3. No suit by firm against third party.

  4. No set off of claim up to Rs. 100.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The suit exceeding Rs.100 can't be set off by the firm. All others are consequences of non-registration of firm.

Multiple choice

The goodwill of the partnership firm

  1. can be sold by the firm

  2. can't be sold by the firm

  3. can be raised among partners

  4. none of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The goodwill of the firm is an asset. Accordingly, it can be sold by the firm.

Multiple choice

A partner whose existence is not known to the public is called

  1. active partner

  2. dormant partner

  3. nominal partner

  4. sub-partner
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Sleeping or dormant partner only invests the money. He is not known to public. Active partner actively participates in the business. Nominal partner gives his name to firm. Sub-partner is the partner of partner.