Partnership and Corporation

During the liquidation process, the partnership will focus on terminal activities?

• True

• False

Right of offset is an established legal doctrine that a deficient partner can exercise to partly or fully apply his loan account to the partnership against his capital deficiency in the process of liquidation?

• True

• False

When non-cash assets are sold less than book value, the sale results to a gain on realization.

• True

• False

The first step of the liquidation process is the sale of the non-cash assets and distribution of realization gain or loss?

• True

• False

Theoretical loss refers to the balance of non-cash assets that were not sold during the liquidation process?

• True

• False

Any partner who may develop a debit balance in his capital account may exercise the right of offset?

• True

• False

In every partnership liquidation, a general partner's separate/personal asset can be subjected to claims from creditors after partnership assets are exhausted?

• False

• True

When non-assets are sold more than the book value, the sale results to a loss on realization?

• True

• False

Realization in its simplest term means dissolution with liquidation?

• True

• False

Solvent partner is a deficient partner who is capable of paying his capital deficiency?

• True

• False