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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 business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

Application for registration of firms should be signed by _____________.

  1. All the partners or their agents

  2. Majority partners or their agents

  3. All working partners or their agents

  4. All minor partners
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The application for registration of a firm must be signed by all the partners or their duly authorized agents.

Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

Identify which of the following statement is true and which is false.
P. Registration of firm does not create partnership, but is only the evidence of existence of partnership.
Q. A partnership firm has to be compulsorily registered in order to commence its business.
R. Registration of firm may be effected at any time during the continuance of partnership.
Select the correct answer from the options given.

  1. P-True, Q-False, R-True

  2. P-False, Q-True, R-True

  3. P-True, Q-True, R-False

  4. P-False, Q-False, R-True
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Registration is evidence of a partnership (P is true), it is not compulsory for commencing business (Q is false), and it can be done at any time (R is true).

Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

Which of the following is NOT required to be given in an application for registration of a firm?

  1. Firm name

  2. Date when each partner joined the firm

  3. Date of birth of each partner of the firm

  4. Duration of the firm
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The registration application requires the firm name, business address, other business locations, duration of firm, and partners' names with joining dates. The date of birth of each partner is not required information under the Partnership Act registration requirements.

Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

Application for rectification of mistake in the documents or the Register of firms shall be made by _________________.

  1. Any one partner or his agent

  2. Majority of partners or their agent

  3. All working partner or their agents

  4. All the partners or their agents
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Rectification of mistakes in the Register of Firms requires the consent and signature of all the partners or their agents to ensure the accuracy of the public record.

Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

A partner may retire from an existing firm __________________.

  1. With consent of all partners

  2. As per express agreement

  3. By written notice in partnership at win

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation
Every partner is an agent of the partnership firm. Individuals have to enter into a contract to become partners. A partner may retire from an existing firm:a) With consent of all partners
b) As per express agreement
c) By written notice in partnership at win.
Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

Partnership agreement can be __________.

  1. Oral

  2. Written

  3. Oral or written

  4. None of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Partnership agreement can be oral or written. Some individuals have to enter into a contract or agreement in order to become partners in a partnership firm. Partnerships are the only business entities that can be formed by oral agreement as well as written agreement.

Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

When it is not registered, a partnership firm is ________.

  1. deemed to be illegal organization and disallowed to carry on business

  2. allowed to carry on business subject to payment of penalty

  3. allowed to carry on business subject to certain disabilities

  4. all of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation
If the partnership firm is not registered, it has to remain deprived of following advantages:
  1. No partner can take any legal action against any other partner.
  2. No partner can intimate proceedings against the firm in order to get his rights.
  3. The firm, too,cannot start proceedings against any partner.
  4. The firm cannot proceed against other parties, while the other parties can proceed against the firm.
Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

Which of the following is not required to be mentioned in the partnership deed?

  1. Age of partners

  2. Name of partners

  3. Address of partners

  4. Firm name
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

To become a partner it is not necessary to mention the age but  to become a partner you need to be a major and should be of sound mind . However, a minor can also become a partner. In such a scenario, all the partners should give their consent in order to admit a minor.

Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

The written agreement of partnership is called ________________.

  1. partnership deed

  2. articles of association

  3. memorandum of association

  4. certificate of incorporation
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Partnership is created by an agreement between the parties. The agreement may be in writing or by words of mouth or implied by the conduct of the parties. However, it is always desirable for the partners to have the agreement in writing. 

The document in writing should contain the important terms of partnership as agreed upon by the partners themselves to avoid any future dispute. So the document in writing containing the terms and conditions as agreed between the partners is called partnership deed.

Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

Which property will be the property of a firm?

  1. The movable and immovable property of the firm

  2. Property brought in by a partner and is vested in the firm

  3. Property brought in by partner and is being used in partnership business

  4. Both a and b
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Subject to contract between the partners, the property of the firm includes all movable and immovable property, rights and interests in property originally brought into the stock of the firm, or acquired, by purchase or otherwise, by or for the firm or for the purposes and in the course of business of the firm, and includes also the goodwill of the business. And any property brought in by a partner and vested in the firm will be considered as the property of the firm.

Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

Which of the following is not the requirement in Partnership deed?

  1. Capital contribution by each partner.

  2. Profit sharing.

  3. Total assets of the partner

  4. Method of dissolution
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

According to the provisions of the Indian partnership act. 1932, a partnership deed is an agreement which consists of the rights and responsibilities of the partners in the firm.

 It also includes capital contributed by the partner, profit sharing ratio, total assets of the partner.etc. It does not include the method of dissolution of the firm.

Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

Voluntary registration is related with?

  1. HUF

  2. Partnership

  3. Sole-proprietorship

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

Voluntary registration is related to partnership firm.

According to part 7 of the Indian Partnership Act 1932, the registartion of the partnership firm is not complusary i.e it is voluntary,but it is complusary in the state of Maharashtra for 1960.

Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

Agreement to share profits in a partnership firm ___________.

  1. must be coupled with an agreement to share losses

  2. is same as agreement to share losses

  3. implies an agreement to share losses

  4. does not necessarily mean an agreement to share losses
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

As per Section $4$ of The Indian Partnership Act, $1932$ "Partnership" is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all. Each person contributes money, property, labour or skill and expects to share in the profits and losses of the business.

Multiple choice business organisation and correspondence partnership 3 - registration of a partnership firm partnership deed registration of partnership registration of partnership firm

The partners enter into partnership through an agreement which may be _________.
(I)    Verbal
(II)   Written 
(III)  Implied 
 The correct answer is :-

  1. (II) only

  2. (I) or (II)

  3. (II) or (III)

  4. (I) or (II) or (III)
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

A partnership agreement can be formed through various methods, including verbal, written, or implied conduct, as the law does not mandate a specific format.