A silent partner takes an active part in the business of the partnership and is not known by
outsiders to be a partner.
FALSE
A secret partner is one who does not take an active part in the partnership business and is not
known as a partner.
FALSE
A partner by estoppel is one who is actually not a partner but who represents himself as one.
TRUE
The partner’s capital account is debited for the debit balance of the drawing accounts at
the end of the period.
TRUE
One of the disadvantages of having a partnership is the risk of joint responsibility
TRUE
The basis of valuation for non-cash investments should be at fair market values in
absence of agreed values.
TRUE
A partnership has a limited life because any change in the relationship of partners
dissolves the partnerships.
TRUE
A partnership is an organization whereby two or more persons bind themselves to
contribute money, property and industry to a common fund with the intention of dividing
the profits or losses between them.
FALSE
A partnership usually retains title to assets contributed to a partnership, so that certain
assets may be identified as belonging to a given partner.
TRUE/FALSE
Only natural person can enter into a contract of partnership
FALSE
A limited partnership must have at least one general partner.
TRUE
A partnership with a capital of less than P 3,000 is void if it is unregistered with the
Securities and Exchange Commissions.
FALSE
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All partnerships are subject to tax at the rate of 30% of taxable income.
FALSE
A dormant partner is one who does not take an active part in the partnership business
though may be known as a partner.
FALSE
In a general partnership, each partner's liability for losses is limited to his investment in
the firm.
FALSE
The essence of partnership is that each partner must share in the profits or losses of the
venture.
TRUE
Each partner is personally liable for all debts of the partnership.
TRUE
One advantage of a partnership over a corporate form of organization is the unlimited
liability of partners.
FALSE
In a limited partnership, none of the partners has unlimited liability for the business all debts.
FALSE
All partnerships have a limited life and assets are co-owned by the partners.
TRUE
There is no income tax imposed on a partnership
FALSE
Mutual agency means that each partner has the right to bind the partnership to contracts.
TRUE
There can never be a partnership without the contribution of money, property, or industry to a
common fund
TRUE
Work or services that may either be personal manual efforts or intellectual may also be
contributed to a partnership
TRUE
A proprietorship has a limited life whereas a partnership may have an unlimited life.
FALSE
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A dormant partner is one who does not take active part in the partnership business and is known
as a partner.
TRUE
A partnership involves mutual agency, unlimited liability for general partners, and limited life.
TRUE
A de jure partnership is one that has complied with all the legal requirements for its
establishment.
TRUE
The limited partners are liable only to the extent of their personal contributions.
TRUE
Differentiate Partnership and Corporation as to Juridical Personality
PARTNERSHIP: Commences from the execution of the articles of partnership.
CORPORATION: From the issuance of certificate of incorporation by the SEC
Differentiate Partnership and Corporation AS TO NUMBER
Partnership: Two or more persons
Corporation: Not exceeding, fifteen (15)
Classification of Partners as to Contribution
1. Capitalist partner
2. Industrial partner
3. Capitalist Industrial Partner
Kinds of Partnership according to the Legality of Existence
1. A de jure partnership
2. A de facto partnership
What are the essential requisites of Partnership
• There must be a valid contract
• There must be two or more persons involved
• There must be contribution of either money, property or industry
• There must be the intention of dividing the profit or loss
• There must be a lawful purpose
Differentiate Partnership and Corporation AS TO CREATION
Partnership: By mere agreement or partners
Corporation: Created by operation of law
Differentiate Partnership and Corporation AS TO SUCCESSION
Partnership: Has no right of succession
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Corporation: There is a right of succession. Corporation has the capacity to continue
existing.
Kinds of Partnership according to the Activities or Purpose
1. Commercial or trading partnership
2. Professional or non-trading partnership
Kinds of Partnership according to the Liabilities of the Partners
1. general partnership
2. limited partnership
Kinds of Partnership according to the Manner of Creation
1. Orally agreed upon
2. Written in a public or private instrument
Classification of Partners
1. General Partner
2. Limited partner.
3. General-Limited partner
1,026,000
74,000
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