Statement I: In the absence of stipulation, the share of each partner in the profits and losses shall be equal to each other.Statement II: A stipulation which excludes one or more partners from any share in the profits or losses is void as a general rule. A. Both statements are true B. Both statements are false C. Only the first statement is true D. Only the second statement is true

Statement I: In the absence of stipulation, the share of each partner in the profits and losses shall be equal to each other.Statement II: A stipulation which excludes one or more partners from any share in the profits or losses is void as a general rule. A. Both statements are true B. Both statements are false C. Only the first statement is true D. Only the second statement is true

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter19: Accounting For Partnerships

Section: Chapter Questions

Problem 5RQ

See similar textbooks

Similar questions

A, B and C as partners in a partnership stipulated and mutually agreed that A shall not share in the profits, and losses. Is the agreement valid as among the partners only and not against third persons? A. Yes, because among the partners it is valid to exempt one from sharing in the profits and losses. B. Yes, valid as long as third persons are not prejudiced. C. Not valid stipulation exempting a partner from sharing profits and losses. D. Not valid as against third persons or partnership creditors.
S1: If the partners did not agree as to how profits are to be divided, then such should be divided among partners equally. S2: Interest based on partner’s capital are always provided. a. both statements are true b. both statements are false c. only S1 is true d. only S1 is false.
Statement I: When a Partnership's operations resulted to a net loss, a partner who contributed legal services, shall have share of loss in accordance to the losses agreement. However, if there is no losses agreement, he shall not be liable to any loss.Statement II: All withdrawals and investments shall be considered when computing for the weighted average capital balance. Group of answer choices S1 is true; S2 is false Both statements are true S1 is false; S2 is true Both statements are false
Statement 1 ln the absence of any agreement, the profit or loss must be divided among the partners equally Statement 2 Permanent withdrawals are made by the partners in anticipation of future share in the proftt O Only Statement 1 is correct O Only Statement ll is correct Both statements are corect oBoth statements are incorrect
I. In fairness to the existing partner and to the partner to be admitted, asset revaluation is to be undertaken before a new partner is admitted. II. To be a partner in an existing partnership one must buy the equity (whole or in part) of an existing partner. Group of answer choices ONLY THE 1ST STATEMENT IS TRUE BOTH STATEMENTS ARE FALSE BOTH STATEMENTS ARE TRUE ONLY THE 1ST STATEMENT IS FALSE
Statement : Non-cash contributions of the partners should be recorded at agreed value in the absence of fair market value. Statemernt i: Interest ratio is the means of dividing the profit and losses among the partners. 0 Both statements are incorrect O Both staterments are correct OOnly Statementls correct Only Statement ll is correct
In the liquidating process, any uncollectible deficiency becomes a loss to the partnership and is divided among the remaining partners' capital balances based on their income-sharing ratio. Question 27 options: True False
1. In a partnership liquidation the realization losses result in a debit balance in one partners’ capital account. If this partner fails to contribute personal assets to make up this deficit, how should the debit balance be handled by the partners? a. It should be written off against partnership profits like any other bad debt. b. It should be allocated to all the partners in their profit and loss ratio. c. It should be allocated to the remaining partners in their remaining P and L ratio. d. It should be set up as a receivable and turned over to a collection agency. 2. During liquidation, a partners’ capital account balance drops below zero. What should happen? a. The other partners should file a legal suit against the partner with the deficit balance. b. The partner with the highest capital balance should contribute sufficient assets to eliminate the deficit. c. The deficit balance…
1 __________ is the consideration which new partner pays to the old partners for the right to participate in the division of future profits. a. Goodwill b. None of the options c. Capital d. Account
7 Which of the following rules apply/s in case of absence of partnership deed? a. No interest on capital Only b. No salaries and No interest on capital c. None of the options d. No salaries Only Clear my choice
no need to explain 1 - A partnership is always liquidated when its term is terminated. 2 - A partner's interest can be obtained by simply adding the partner's capital account and loan account. 1 is True and 2 is False 1 is False and 2 is True Both are True Both are False
S1: Partnership profits and losses (including bonuses and revaluations) are allocated in accordance with their Profit and Loss Ratio. S2: If only the share in the profits have been established in the articles of partnership, then the share in the losses must be in accordance with their profit ratio. A. Both are trueB. S2 True; S1 FalseC. Both are falseD. S1 True; S2 False