Partnership Questions with solutions MCQs

1. The liability of at least one partner is unlimited whereas the liability of other partners is limited. What type of partnership is represented here?

A

Partnership at will

B

Limited Partnership

C

General Partnership

D

Particular Partnership

Partnership Accountancy and Book Keeping
Correct Answer : B
Explanation :

In limited partnership, the liability of at least one partner is unlimited whereas the rest may have limited liability.

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2. To start a partnership business, what should be the minimum number of partners?

A

2

B

5

C

15

D

20

Partnership Accountancy and Book Keeping
Correct Answer : A
Explanation :

Minimum two persons are required to start a partnership firm as partnership can only be done when two or more people are involved while in banking business, minimum 10 persons are required to join hands to establish a partnership firm.

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3. What type of agreement is used to form a partnership business?

A

Written Agreement

B

Oral Agreement

C

Written or Oral Agreement

D

None of the above

Partnership Accountancy and Book Keeping
Correct Answer : C
Explanation :

A partnership deed is an agreement between two or more individuals who sign a contract to start a profitable business together. They agree to be the co-owners, distribute responsibilities, income or losses for running a business.

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4. What is the partnership written agreement known as:

A

Partnership Agreement

B

Contract

C

Partnership Deed

D

Partnership Act

Partnership Accountancy and Book Keeping
Correct Answer : C
Explanation :

The written agreement of partnership is called a partnership deed. It is a contract between two or more individuals who decide to manage and operate a business together for profit-making.

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5. No partnership agreement, what will be the percentage of profit-sharing ratio between them?

A

Unequal

B

Equal

C

It will depend on the experience of a partner

D

It will depend on a partner`s capital

Partnership Accountancy and Book Keeping
Correct Answer : B
Explanation :

If there is no partnership agreement the profits will be share equally. ... The profit must be share equally in the case of a partnership firm ... Profit sharing Ratio : Profits and losses would be shared equally among partners.

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6. Which is not a feature of a partnership business?

A

Ease of formation

B

Limited liability

C

Limited life

D

Mutual agency

Partnership Accountancy and Book Keeping
Correct Answer : B
Explanation :

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