Law Legal Studies · Commerce Accountancy
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
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Insanity of a partner
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Misconduct by the partner
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Insolvency of partner
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Incapacity of partner
C
Correct answer
Explanation
When all the partners, or one of the partners is declared insolvent, the firm is automatically dissolved. There is no need to move the court in that case.
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To buy or sell goods on account of partnership
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To borrow money for the purposes of firm
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To enter into partnership on behalf of firm
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To engage a lawyer to defend actions against firm
C
Correct answer
Explanation
A partner cannot enter into partnership on behalf of the firm.
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arising from a contract
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of Indian Companies Act
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of mutual agreement
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of Indian Registration Act
A
Correct answer
Explanation
A partner of an unregistered firm cannot sue the firm or any other partner of the firm to enforce a right under provisions arising from a contract.
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void
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lawful
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voidable
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illegal
B
Correct answer
Explanation
The partnership agreement will be lawful as partners have mutually agreed regarding profit or loss sharing ratio.
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Partnership agreements are always implied.
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Partnership agreements are always expressed.
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Partnership agreements are implied and expressed.
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Partnership agreements are implied or expressed.
D
Correct answer
Explanation
Partnership agreement may not be implied and expressed simultaneously. So, it may be implied or expressed.
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Rohit's estate will be liable for the price of the machine.
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Rohit's estate will not be liable for the price of the machine.
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Amrit Mechanicals Ltd. will be liable for the price of the machine.
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Yuvi’s estate will be liable for the price of the machine.
B
Correct answer
Explanation
Rohit's estate will not be liable for the price of the machine as order was not placed on personal behalf of Rohit.
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status
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an agreement
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legal provisions
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mutual understanding
B
Correct answer
Explanation
The relation of partnership arises from mutual agreement between all the partners.
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Partner by holding out
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Secret partner
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Sub-partner
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Partner by estoppel
C
Correct answer
Explanation
A partner may associate anybody else in his share in the firm. If he gives a part of his share to the stranger, then the sub-partner is a non-entity for the partnership.
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Indian Partnership Act
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Indian Stamp Act
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Indian Contract Act
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Indian Companies Act
B
Correct answer
Explanation
Partnership deed must be properly drafted and stamped according to the provision of Indian Stamp Act.
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a promisor in an agreement
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a principal
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a partner in a newly formed firm with the consent of all the partners
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insolvent
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agent
E
Correct answer
Explanation
A minor can be an agent, but his principal is bound by his acts.
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A minor as a partner can participate in the management of firm.
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A minor as a partner can inspect the books of firm.
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A minor as partner can sue other partners for his share while remaining in the firm as partner.
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A minor as a partner has to leave the firm necessarily when he attains the age of majority.
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None of these
E
Correct answer
Explanation
All the options are incorrect.
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Both (A) and (R) are true and (R) is the correct explanation of (A).
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Both (A) and (R) are true but (R) is not the correct explanation of (A).
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(A) is true, but (R) is false.
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(A) is false, but (R) is true.
C
Correct answer
Explanation
When something of valuable nature is acquired by a partner in breach of his duty in good faith, it is taken to be acquired for the benefit of all the partners and has to be accounted for to the firm. Partnership is not a trust. It is a contract.
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Joint bank method
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Memorandum method
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Columunar method
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None of the above
C
Correct answer
Explanation
Joint Bank is a method of joint Venture where separate sets of books are maintained and Memorandum method is a method of Joint Venture where separate set of books is not maintained. There is no method of Joint venture called Columnar Method.
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There is no difference between joint venture and partnership
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Consignment and joint venture is same
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In case of joint venture, none of the act is applicable
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In case of joint venture, the number of related party is one only
C
Correct answer
Explanation
There is no specific act governing Joint venture transactions.
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intention
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interest
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design
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object
C
Correct answer
Explanation
Option (3) is correct: Persons are said to be joint tortfeasors when their separate shares in the commission of a tort are done in furtherance of a common design.