Mann_BLRB 9_TB_Ch31

Business Law and the Regulation of Business

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Chapter 31—Formation and Internal Relations of General Partnerships TRUE/FALSE 1. A corporation may not be a partner in a partnership. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 2. Under the common law, a partnership was generally considered to be a legal entity rather than an ag- gregate of individuals. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 3. The UPA treats a partnership as a legal entity for all purposes. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 4. Partners may elect whether or not the partnership will be taxed as a separate entity. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 5. General partners differ from limited partners only in the amount of input they have in partnership de- cisions. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 6. Michelle and Margaret agree to form a partnership. The partnership contract between Michelle and Margaret does not have to be in writing in order to be enforceable in the courts. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 7. Miller and Baker formed a partnership and purchased a cycle shop. The name of the new business can- not be "Miller Cycle Shop" because the name of the partnership must include the names of both part- ners if it includes the name of one partner. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 8. Owners of interests in businesses with unlimited liability place their entire estate at risk. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 9. "Partnership property" is the sum of the partnership’s assets, including all property acquired by a part- nership. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 10. A partner can withdraw his partnership capital at any time. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 11. The UPA does not allow a partnership to own property.
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ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 12. A sole proprietorship dissolves upon the death of the owner. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 13. The RUPA cannot be modified by agreement of the partners to a partnership. Its provisions must be strictly followed in any partnership agreement. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 14. General partnerships are used frequently in finance, insurance, accounting, real estate, law, and other services. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 15. Under the UPA, a partner's ownership interest in any specific item of partnership property is that of a tenant in partnership. ANS: T TOP: AICPA BB-Legal MSC: AACSB Analytic 16. A partner cannot assign his interest in the partnership without dissolving the partnership. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 17. Sole proprietors have limited liability for the sole proprietorship's debts. ANS: F TOP: AICPA BB-Legal MSC: AACSB Analytic 18. Under the RUPA, no person may become a member of a partnership without the consent of all the partners. ANS: T
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Mann_BLRB 9_TB_Ch31 - Chapter 31-Formation and Internal...

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