Exam 30: Formation and Internal Relations of General Partnerships

Colleen,Joanna,and Ellen form Capital City Company,a partnership.Colleen contributes expertise;Joanna,$15,000;and Ellen,$20,000.After a year,Joanna adds $12,000 as a loan.Ten years later,Capital owes $44,000 to creditors,total assets are $112,000,and they decide to dissolve the business.How will these assets be distributed and what will each receive?

Marilyn,George,and Christine pool their money to buy land for a vegetable garden.They plan to sell the produce at a roadside stand that summer.Are they partners?

The choice of the most appropriate form of business enterprise cannot be determined without considering the particular circumstances of the owners.

Sharing of gross returns establishes a partnership.

Which of the following is true of a partner's fiduciary duty?

Identify which forms of business organization provide the owners with limited liability for the business's obligations and which forms of organization allow the owners to participate in the management and control of the business.

Corporations today outnumber unincorporated business associations.

Under the RUPA,a partnership agreement may be written or oral,but not implied.

Identify six factors affecting the choice of the most appropriate form of business enterprise.Name the nine forms of business associations discussed in the chapter.

The trustees are generally not personally liable for the debts of a business trust.

White,Gray,and Greene enter into a contract to form a partnership,but the contract says nothing about the sharing of profits and losses.Which of the following will take place?

General partnerships are frequently used in finance,accounting,real estate,and law.

All states have authorized the formation of limited liability companies.

Drew,Elmer,and Frank are partners in the DEF partnership.The partnership is being dissolved.It has $200,000 in cash assets and it owes $410,000 to creditors.Profits and losses of the partners are shared equally,although Drew contributed $100,000 in capital;Elmer contributed $50,000 in capital;and Frank contributed $25,000 in capital.Which of the following is correct with regard to the responsibility of each partner?

Income from some types of business entities is taxed twice.

Clark and David are partners.Clark has contributed $25,000.David has contributed only his time and skill.On dissolution,after all firm debts are paid,$20,000 in assets remains.Which of the following is NOT correct?

All 50 states have adopted the Revised Uniform Partnership Act.

In which of the following situations would the persons be partners?

A joint venture is necessarily of short duration.

Absent an agreement otherwise,upon dissolution,a partner is entitled to which of the following after payment of partnership creditors?