BAT4M UNIT 4 REVIEW

Two proprietorships CANNOT combine and form a partnership.

• True

• False

A partnership is taxed as a single legal entity.

• True

• False

In a limited liability partnership, all the partners have limited liability for the debts of the partnership.

• True

• False

When a partner exceeds his or her authority and the act looks appropriate for the partnership, the act is NOT binding on the other partners and the partnership.

• True

• False

Because of the unlimited liability of partners in a partnership, it is easier for a partnership to gain large amounts of investment capital.

• 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 a long-lived asset is contributed to a partnership by a partner, the entity will record the fair value of the asset and the accumulated depreciation which has accumulated on it.

• True

• False

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

• True

• False

Partnership profit or loss must be divided equally in a partnership.

• True

• False

Partnership profit or loss must be divided according to the formulas which are outlined in the partnership agreement.

• True

• False