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WorksheetsPartnership Law Quiz
Total questions: 103
Worksheet time: 52mins
In a contract of sale, which party bears the risk of loss if the goods are destroyed without fault before the transfer of property?
Seller
Buyer
Both
None
The document transferring property from the seller to the buyer is called:
Bill of lading
Delivery note
Invoice
Deed of sale
The unpaid seller can resell the goods if:
The buyer rejects the goods
The buyer breaches the contract
The goods are perishable
Both b and c
If goods perish after the contract but before delivery, the contract is:
Valid
Void
Voidable
Enforceable
An agreement to sell becomes a sale when:
The goods are delivered
Ownership is transferred
Payment is made
All conditions are fulfilled
Who is responsible for the delivery of goods in a contract of sale?
Buyer
Seller
Auctioneer
Carrier
The right of stoppage in transit is available only to:
A paid seller
An unpaid seller
A consignee
The carrier
The buyer's right to examine the goods before acceptance is under:
Section 35
Section 34
Section 33
Section 32
In the event of a breach of contract, the buyer can claim:
Specific performance
Damages
Both
None
Where delivery is to be made by the seller in installments, the buyer can:
Refuse all deliveries if one installment is defective
Accept defective goods
Reject all future installments
Sue for breach of contract
Delivery of goods means:
Transfer of ownership
Transfer of possession
Transfer of title
Transfer of risk
The sale of goods act covers:
Movable property
Immovable property
Both
Intangible property
Goods which cannot be legally sold are:
Legal goods
Contingent goods
Stolen goods
Ascertained goods
What is the primary purpose of the Indian Partnership Act, 1932?
To govern the formation of companies
To regulate partnerships and their dissolution
To control sole proprietorships
To manage public companies
What is the minimum number of partners required to form a partnership under the Indian Partnership Act, 1932?
1
2
3
7
Which of the following is NOT a characteristic of a partnership?
Mutual agency
Limited liability
Sharing of profits
Joint management
A partnership is defined under which section of the Indian Partnership Act, 1932?
Section 4
Section 5
Section 7
Section 9
What does 'mutual agency' in a partnership imply?
Each partner can act on behalf of the other partners
Partners must act independently
Only the managing partner can act for the firm
Each partner is restricted to their own business dealings
In a partnership firm, which of the following is NOT considered a partner?
Sleeping partner
Nominal partner
Minor partner
Silent partner
According to the Indian Partnership Act, 1932, a minor can be admitted to the benefits of a partnership. Which section deals with this?
Section 6
Section 7
Section 10
Section 11
The 'Partnership Deed' is also known as?
Partnership Agreement
Partnership Act
Partnership Document
Partnership Order
What is the primary method to dissolve a partnership firm?
Court order
Mutual agreement
Death of a partner
Government order
Which section of the Indian Partnership Act, 1932, deals with the registration of a partnership firm?
Section 58
Section 60
Section 62
Section 64
In the absence of an agreement, how are profits and losses shared among partners?
Equally
As per capital contribution
As per seniority
As per the decision of the managing partner
Which of the following is not a type of partner?
Active partner
Silent partner
Minor partner
Limited partner
The authority of a partner to act on behalf of the firm arises from:
Partnership Deed
The consent of all partners
Mutual agreement
The Indian Partnership Act, 1932
In the case of dissolution by an order of the Court, which section is relevant?
Section 39
Section 42
Section 43
Section 45
Which section addresses the dissolution of partnership by the happening of certain events?
Section 40
Section 41
Section 42
Section 43
What is the legal position of a partner's liability in a partnership firm?
Limited to their capital contribution
Limited to a specific amount
Unlimited and joint
Limited to the extent of partnership assets
Under the Indian Partnership Act, 1932, a partner is entitled to:
Salary for services rendered
Reimbursement of expenses
Profit share as agreed
Interest on capital
Which section deals with the rights of partners to participate in the business?
Section 15
Section 16
Section 17
Section 18
Which of the following is a ground for the dissolution of a partnership under the Indian Partnership Act, 1932?
Change in the business address
Transfer of partnership interest
Insolvency of a partner
Appointment of a new partner
In a partnership, the sharing of losses is:
Proportional to capital contribution
As per the agreement
Based on the seniority of partners
Based on the profit-sharing ratio
Which section deals with the provision of indemnity by partners for acts done in the ordinary course of business?
Section 16
Section 17
Section 18
Section 19
A partner who does not take part in the day-to-day operations of the business but shares in the profits is known as a:
Silent partner
Nominal partner
Dormant partner
Limited partner
The principle of 'partnership by estoppel' means:
Partnership can be formed by verbal agreement
A person can be treated as a partner if they have acted as one
Partners cannot be held liable for acts done by others
Partnership can exist without a written agreement
Which section of the Indian Partnership Act, 1932, discusses the determination of the share of each partner in the case of dissolution?
Section 37
Section 38
Section 39
Section 40
What is the effect of the death of a partner on the partnership firm?
The firm automatically dissolves
The surviving partners must continue the firm
The firm continues until all partners agree to dissolve
The partnership becomes a sole proprietorship
Which section deals with the continuation of partnership after the death of a partner?
Section 45
Section 46
Section 47
Section 48
Under the Indian Partnership Act, 1932, a partner is entitled to which of the following in the absence of an agreement?
A salary for their work
Reimbursement of expenses
A share in profits and losses
Compensation for goodwill
In case of a partnership firm, which of the following is correct regarding liabilities?
Liabilities are shared equally among partners
Liabilities are limited to the amount of capital contributed
Each partner is jointly and severally liable for the firm's liabilities
Liabilities are only covered by firm assets
In the absence of a partnership deed, how are the profits of a partnership firm shared?
According to the capital contribution
As agreed by the partners
Equally among the partners
Based on seniority
Which of the following is a key characteristic of a limited partnership?
Unlimited liability for all partners
Limited liability for certain partners
No formal registration required
Mandatory public disclosure of partnership details
Which section of the Indian Partnership Act, 1932, allows a partner to retire from the firm?
Section 30
Section 31
Section 32
Section 33
What is the effect of a partner's retirement on the partnership firm?
The firm is dissolved automatically
The retiring partner's liability ceases immediately
The firm continues if agreed by remaining partners
The firm must be re-registered
A partner who represents himself as a partner in a firm but is not actually a partner is known as:
A nominal partner
A dormant partner
A partner by estoppel
A silent partner
Which section provides for the settling of accounts between partners upon dissolution?
Section 40
Section 41
Section 42
Section 43
Which of the following is NOT a reason for the dissolution of a partnership under the Indian Partnership Act, 1932?
Completion of the partnership's objective
Court order due to partner misconduct
Bankruptcy of the firm
Transfer of partnership interest
A partnership formed for a specific period is dissolved upon:
The end of the period
The death of a partner
The retirement of a partner
The bankruptcy of a partner
Which of the following is true about a partnership firm's name?
It must be unique and registered
It can be the name of any partner
It does not require registration
It should reflect the nature of business
A partner who has invested in the firm but does not actively participate in its management is known as:
An active partner
A nominal partner
A sleeping partner
A dormant partner
In the event of dissolution, which of the following is considered first for settlement of debts?
Creditors' claims
Partner's loans
Partner's capital
Profit sharing ratio
A partnership deed must be in:
Written form
Verbal form
Electronic form
Notarized form
Which section of the Indian Partnership Act, 1932, pertains to the power of a partner to bind the firm?
Section 18
Section 19
Section 20
Section 21
Under the Indian Partnership Act, 1932, what is the liability of a partner for acts done by another partner?
Limited to the firm's assets
Unlimited and joint
Limited to the partner's share in the firm
Limited to the extent agreed in the partnership deed
Which section covers the provisions related to the transfer of a partner's interest?
Section 25
Section 26
Section 27
Section 28
If a partnership firm is registered, it is entitled to:
Sue and be sued
Operate without restrictions
Avoid paying taxes
Transfer its interest without restrictions
Which section discusses the dissolution of a partnership firm due to an agreement between partners?
Section 40
Section 41
Section 42
Section 43
The 'Partnership Act' was enacted in which year?
1930
1932
1935
1940
Which of the following is a ground for dissolution of partnership by the Court?
Disagreement over profit-sharing
Death of a partner
Insolvency of a partner
Partnership deed violation
In the absence of a partnership deed, how is a partner's share of profits determined?
Based on capital contribution
According to mutual agreement
Equally among all partners
Based on business performance
Which section of the Indian Partnership Act, 1932, provides for the settlement of accounts between partners on dissolution?
Section 37
Section 38
Section 39
Section 40
In a partnership, what happens if a partner becomes insolvent?
The partnership automatically dissolves
The partner's share is sold to other partners
The firm continues with the insolvent partner's assets being liquidated
The partner is expelled and the firm continues
A guarantees B's loan from a bank. B fails to repay. The bank sues A.
A is not liable unless B refuses in writing
A is liable only for half of the loan
A is liable as a surety
A can escape liability by denying knowledge of the loan
A gives a guarantee for B's conduct as a cashier. B commits theft.
A is liable as surety
A is not liable as theft is not covered
A is liable only if the bank reports immediately
A can withdraw his guarantee retrospectively
A contracts to indemnify B against legal consequences of a land dispute. B is sued and pays compensation.
A is liable to pay nothing
A is liable to reimburse B
A can wait until B proves innocence
A is not liable as there was no express contract
X guarantees Y's conduct as manager. Y misappropriates funds.
X is discharged if employer delays action
X remains liable
X is liable only if misappropriation is proved in court
X can deny liability due to delay
A promises to pay B's rent if B defaults. B fails to pay for 2 months.
A is not liable
A is liable only if tenancy is not terminated
A is liable to pay the rent to the landlord
A can recover the rent from the tenant directly
X guarantees Y's debt up to ₹50,000. Y defaults on ₹80,000.
X is liable for ₹80,000
X is liable for ₹50,000
X is not liable
X is liable if Y becomes bankrupt
In a contract of indemnity, the indemnifier is liable when:
The indemnified faces a threatened loss
Actual loss occurs
The indemnified signs the contract
The indemnified sells property
P contracts to indemnify Q for legal consequences arising from P's actions. A suit is filed against Q.
Q cannot claim indemnity until judgment is passed
Q can claim as soon as the suit is filed
Q must prove innocence
Q cannot claim unless P joins the suit
M guarantees N's conduct as warehouse keeper. N negligently allows goods to be stolen.
M is not liable for negligence
M is liable as a surety
M is liable only if theft was proven
M is not liable for non-criminal actions
A gives continuing guarantee for B's purchases. A revokes guarantee. B buys goods the next day.
A is liable for those goods
A is not liable as guarantee was revoked
A is liable only if notice was not received
A is liable if contract specifies
A buys goods from B. Goods are destroyed before delivery. Risk is with:
A
B
Insurer
Transporter
X buys a TV from Y. The set explodes due to a manufacturing defect.
Y is not liable
X can sue Y for breach of condition
X must claim warranty only
X can sue manufacturer only
A sells a car to B. Ownership passes, but delivery is not done. Who bears risk of loss?
A
B
Delivery company
Jointly
B buys goods from C, believing them to be of a certain brand. Goods are not.
There is a breach of warranty
There is a breach of condition
B cannot claim as he inspected
B must return the goods to claim
X contracts to sell 100 kg rice to Y. Before delivery, the warehouse burns down.
Contract is voidable
X must deliver from other stock
Contract becomes void
Y must wait for replacement
A agrees to sell B 500 bags of cement by next week.
This is a sale
This is an agreement to sell
This is a hire contract
This is a consignment
A sells a defective fridge to B. B uses it for 3 months.
B can return it anytime
B is deemed to have accepted it
B can return only if warranty covers
B can claim refund without return
X agrees to sell a car that belongs to Y. X doesn't own it.
Sale is valid
Contract is illegal
Contract is void
B can sue for fraud
In sale of goods, "caveat emptor" means:
Seller must inspect
Buyer must inspect
No one is liable
Warranty is automatic
A sells goods to B, who sells them to C. Later A claims C must return goods.
C is liable
B is liable
C has good title
B must refund C
A gives his watch to B for repairs. B is a bailee.
B must return it in good condition
B can keep it as security
B can lend it to others
B need not take care
A pledges gold with a bank. The bank loses it.
Bank is not liable
A must bear the loss
Bank is liable as bailee
Bank can ask for insurance
A gives goods to B to keep safely. B uses them without permission.
B is liable for breach of duty
A cannot recover
B is not a bailee
B must return it when asked
A gives goods to B for transportation. B refuses to deliver unless paid extra.
B is exercising lien
B is breaching contract
B is pledging the goods
B is acting as seller
X pledges stock with Y and later demands return.
Y must return it only after loan is paid
Y must return on demand
Y must return if pledge was verbal
X cannot demand return
A leaves his cycle at a stand. It's stolen.
Bailment exists
Bailment doesn't exist
Owner is liable
Owner can claim damages
In pledge, the pawnee has right to:
Use the goods
Sell the goods without notice
Retain the goods till debt is paid
Modify the goods
A pledges goods to B. Later, B sells them without notice.
Sale is valid
Sale is invalid
B can't sell unless authorized
A must compensate
A gives a ring for cleaning. It's damaged due to negligence.
Bailor is liable
Bailee is liable
Bailee has no duty
Bailor must repair
Pledge is different from bailment as:
Ownership is transferred
It is for safekeeping
It is always free
It is for security
A appoints B to buy goods. B buys in own name.
A is not bound
A is bound
B is personally liable
Contract is void
Agent acts beyond authority but principal later approves.
Act is void
Act is illegal
Act is ratified and binding
Agent is sued
A gives power to B to sell property. B sells below market rate.
Sale is void
Sale is valid
B is liable for loss
A must compensate buyer
Agent appointed without consideration is:
Not valid
Valid
Requires special contract
Can't perform legal acts
Agent is personally liable when:
Principal is disclosed
Acts within authority
Principal is foreign
Agent is minor
X asks Y to sell goods as agent. Y sells to Z and vanishes with money.
X asks Y to sell goods as agent. Y sells to Z and vanishes with money.
X must bear loss
X can sue Y
Contract is void
Termination of agency takes effect:
Immediately
When agent knows
After a week
When notified to third party
When notified to third party
Principal unaware of facts
Unauthorized act
Mutual consent
Legal contract
A partner acts beyond authority. The firm is liable if:
Other partners knew
It was done in usual course
It was profitable
It caused loss
Partners share profit equally unless:
Law provides otherwise
Partnership deed states otherwise
One partner demands more
There is loss
