Partnership Quiz

A partnership must make a profit.

• True

• False

A partnership must have a legal written agreement.

• True

• False

Two proprietorships CANNOT combine and form a partnership.

• True

• False

When assets are rolled into a partnership, the value that they are allocated in the partnership is the same as the value in the previous entity.

• True

• False

When accounts receivable are contributed to a partnership, they are valued at their expected realizable value.

• True

• False

When profit is allocated in a 3:2:1 ratio, it means that one partner will get 50% of the profit.

• True

• False

Salaries to partners and interest on partner's capital balances are expenses of the partnership.

• True

• False

On the financial statement of a partnership, a separate statement of the division of partnership profit or loss is prepared.

• True

• False

The admission of a new partner may result in a bonus to the existing partners.

• True

• False

In the withdrawal of a partner, a payment from the partnership assets will affect only the remaining partners' personal assets.

• True

• False