Tag: partnership 2 - organisation, classification, rights, duties and liabilities of partners

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Questions Related to partnership 2 - organisation, classification, rights, duties and liabilities of partners

Multiple choice elements of business partnership 2 - organisation, classification, rights, duties and liabilities of partners types of partners types of partners and partnership firms types, rights and duties of partners

Dormant partner ______________.

  1. never takes part in business activities.

  2. is not liable for any act done by other partners.

  3. will not share losses of the firm.

  4. existence in partnership is invalid.
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A dormant or sleeping partner is characterized by their lack of active participation in the day-to-day management of the firm's business activities, even though they are still liable for the firm's debts.

Multiple choice elements of business partnership 2 - organisation, classification, rights, duties and liabilities of partners types of partners types of partners and partnership firms types, rights and duties of partners

Retiring Partner continues to be liable for acts of the Firm done __________.

  1. upto the date of admission of a new Partner.

  2. upto the date of giving public notice of retirement.

  3. upto the close of the financial year in which he retires.

  4. all of the above.
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A retiring partner remains liable for all debts and obligations incurred by the firm until a public notice of their retirement is given. This protects third parties who may still believe the partner is part of the firm.

Multiple choice elements of business partnership 2 - organisation, classification, rights, duties and liabilities of partners types of partners types of partners and partnership firms types, rights and duties of partners

For the acts of the Firm ________.

  1. minor is personally liable.

  2. minor's share is liable.

  3. guardian is personally liable.

  4. there is no liability at all for or on behalf of the minor.
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A minor can be admitted to the benefits of a partnership, but they are not personally liable for the firm's debts. Only their share in the partnership assets is liable for such obligations.

Multiple choice elements of business partnership 2 - organisation, classification, rights, duties and liabilities of partners types of partners types of partners and partnership firms types, rights and duties of partners

A Retiring Partner is entitled to Profits of the Firm?

  1. Upto $31^{st}$ March

  2. When last accounts is made up

  3. Up to retirement date

  4. Not entitled to any Profit.
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

A retiring partner is entitled to their share of the profits earned by the firm up to the date of their actual retirement.

Multiple choice elements of business partnership 2 - organisation, classification, rights, duties and liabilities of partners types of partners types of partners and partnership firms types, rights and duties of partners

Retiring Partner may be discharged from liability to any third party for acts of Firm done before his retirement by ________.

  1. an agreement made with such third party and the Partners of reconstituted Firm

  2. implied from the course of dealing between the third party and reconstituted Firm after he had knowledge of the retirement

  3. either (a) or (b)

  4. both (a) and (b).
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

A retiring partner can be discharged from liability for past acts through an express agreement with the creditors and the remaining partners, or through an implied agreement based on the course of dealing.

Multiple choice elements of business partnership 2 - organisation, classification, rights, duties and liabilities of partners types of partners types of partners and partnership firms types, rights and duties of partners

In case of Partnership at Will, Notice of intention to dissolve the Firm may be served by ___________.

  1. sleeping partners only

  2. any of the working partners

  3. any of the partners

  4. majority of the partners.
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

In a partnership at will, the partnership can be dissolved by any partner giving notice in writing to all other partners of their intention to dissolve the firm.

Multiple choice elements of business partnership 2 - organisation, classification, rights, duties and liabilities of partners types of partners types of partners and partnership firms types, rights and duties of partners

When a Partner is expelled otherwise than in good faith, it is ______.

  1. generally valid

  2. valid vis-a-vis third parties

  3. in restraint of trade

  4. null and void.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Under the Indian Partnership Act, the expulsion of a partner must be done in good faith and in accordance with the powers conferred by the partnership agreement. If it is not in good faith, the expulsion is null and void.

Multiple choice elements of business partnership 2 - organisation, classification, rights, duties and liabilities of partners types of partners types of partners and partnership firms types, rights and duties of partners

Loss arising out of Partners' insolvency shall be made up by ___________.

  1. that Partners' estate

  2. that Partners' Legal Heirs

  3. the Firm itself

  4. the Solvent Partners.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

If a partner becomes insolvent, their share of the loss must be borne by the remaining solvent partners in their profit-sharing ratio.

Multiple choice elements of business partnership 2 - organisation, classification, rights, duties and liabilities of partners types of partners types of partners and partnership firms types, rights and duties of partners

Mission and Vision statements are NOT commonly used to__________.

  1. Guide management's thinking on strategic issues, especially during times of significant change

  2. Create wider linkages with customers suppliers and alliance partners

  3. Help establish a framework for ethical behaviour

  4. Inspire employees to work more productively by providing focus and common goals
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Mission and vision statements are internal tools for organizational direction, culture, and strategy. Creating external linkages with suppliers or partners is typically the function of business development or strategic alliances, not the primary purpose of a mission statement.

Multiple choice elements of business partnership 2 - organisation, classification, rights, duties and liabilities of partners types of partners types of partners and partnership firms types, rights and duties of partners

Persons who have entered into partnership with one another are called individually __________________.

  1. Firm

  2. Co-owner

  3. Firm name

  4. Partner
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Persons who have entered into a partnership agreement are collectively called a 'firm' and individually called 'partners'.