This results when a partner dies and the remaining partners decide to terminate the business:

Partnership Liquidation

Quiz
•
Business
•
University
•
Medium
Dianne Tang-See
Used 98+ times
FREE Resource
10 questions
Show all answers
1.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
dissolution
liquidation
incorporation
recognition
2.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
In liquidation, the sale of non-cash assets is called
realization
net proceeds
gain from sale
loss from sale
3.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
Lump sum liquidation is the process where partners receive cash as it becomes available.
True
False
4.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
Partner A has a capital deficiency of P25,000, and the partnership has an existing loan payable to A amounting to P30,000. Partner A can opt to collect just the balance of P5,000 from the partnership. This option is called the:
capital deficiency
right of offset
loss on realization
balance payment
5.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
If A's capital is deficient, but there is a loan payable to B, the right of offset can be applied.
True
False
6.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
If the proceeds from the sale is less than the book value of the non-cash assets sold, this will decrease partnership assets but increase the partners' equity.
True
False
7.
MULTIPLE CHOICE QUESTION
1 min • 1 pt
The feature of unlimited liability covers all partners.
True
False
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