1. In the absence of partnership agreement to the contrary, what is the obligation of the partners as regards to capital contribution?

a. Equally

b. Based on their loss agreement

c. Based on their withdrawal agreement

d. Based on their profit agreement

2. How should the net profit or net loss of the partnership be divided among the partners, whether capitalist or industrial?

a. In accordance with just and equitable sharing taking into account the circumstances of the partnership

b. In accordance with their capital contribution ratio

c. Equally

d. In accordance with the partnership agreement

3. In the absence of partnership profit agreement to the contrary, how shall industrial partner share in partnership profit?

a. Equal to the share of the least capitalist partner

b. Equal to the share of the highest capitalist partner

c. Equal to the average share capitalist partners

d. Just and equitable share

4. In the absence of partnership loss agreement to the contrary, how shall industrial partner share in partnership loss?

a. Just and equitable

b. Based on profit agreement ratio

c. Equal to the share of the least capitalist partner

d. None

5. At the date of partnership formation, the amount credited to a partner's capital is less than the fair value of the property contributed. Which of the following is the most valid reason?

a. Bonus has been given by the partner to the other partners.

b. Goodwill arising from partnership formation has been recognized.

c. The property contributed by the partner is impaired.

d. The property contributed by the partner has been subjected to positive asset revaluation

6. Which statement is true if the total contributed capital of all the partners is equal to the

total agreed capitalization of new partnership in admission of new partner by investment?

a. Any of the choices

b. Impairment loss is recognized

c. Asset revaluation is recognized.

d. Bonus to or from new partner is recognized.

7. In admission of new partner by investment, the total contributed capital of all the partners is more than the total agreed capitalization of new partnership but the capital credit of new partner is less than his capital contribution. Which of the following statements is correct?

There has been asset revaluation with bonus to new partner

There has been bonus given to old partners without any revaluation or impairment

There has been asset impairment with bonus to old partners

There has been asset revaluation with bonus to old partners

8. When a new partner is admitted to an existing partnership through the purchase of a portion of existing interest of incumbent partner, which of the following is correct?

a. There will be increase in the total assets of the partnership equivalent to the amount paid by the newly admitted partner.

b. The total capital of the old and new partnership will be the same.

c. The partnership will recognize gain or loss on the difference between the amount paid and capital transferred.

d. Goodwill may be recognized by virtue of admission.

9. Which of the following transactions will decrease the capital balance of a partner?

a. Additional investment by said partner

b. Share in partnership profit

c. Drawings by said partner

d. Receipt of bonus from other partners

10. At the time of retirement, a retiring partner received more than the amount of his capital contribution while the remaining partners capital increased after the retirement. Which of the following is most valid reason?

a. Asset revaluation is recognized.

b. Bonus is given by retiring partner to remaining partners.

c. Bonus is given by the remaining partners to retiring partner.

d. Goodwill during retirement is recognized.

11. Which of the following will not result to dissolution of a general partnership?

a. Death of a partner

b. Assignment of a partner's interest to a third person

c. Retirement of a partner

d. Insolvency of a partner

12. At the time of partnership liquidation, which credits shall be settled first?

a. Amount owing to partners with respect to capital contribution

b. Amount owing to partners other than capital contribution and share in profit

c. Amount owing to third persons

d. Amount owing to partners with respect share in profit

13. The existing partnership has been incorporated but the capital balances of the partners exceed the total par value of the shares to be issued. The difference shall be credited to

a. Other comprehensive income

b. Retained earnings

c. Profit or loss

d. Share premium

14. Which of the following statements concerning the formation of partnership business is correct?

a. The juridical personality of the partnership arises from the issuance of certification of registration.

b. The capital to be credited to each partner upon formation may not be the amount actually contributed by each partner.

c. PFRS allows recognition of goodwill arising from the formation of partnership.

d. The parties may become partners only upon contribution of money or property but not of industry or service

15. Under the generally accepted accounting principles in the Philippines, what is the acceptable reason when the amount credited to a partner is greater than the amount actually contributed by such partner during partnership formation?

a. Recognition of goodwill by virtue of special skills or reputation of said partner.

b. Recognition of impairment loss on the property contributed by said partner.

c. When there is bonus given by said partner to the other partners.

d. Receipt or transfer of capital from other partner by virtue of partner's agreement resulting to bonus to the said partner.

16. Regina, Jessica and Nataly entered into a contract of partnership with a total capital contribution of P5,000. The parties failed to register its articles of co-partnership with the Securities and Exchange Commission. Which of the following statements is correct?

a. The contract of partnership will bind third persons.

b. The contract of partnership is void because the law provides that when the capital contribution is at least P3,000 it must be registered with Securities and Exchange Commission.

c. The contract of partnership remains to be valid

d. The partnership business does not obtain juridical personality for failure to register with Securities and Exchange Commission.

17. In the absence of agreement as to distribution of profit, how shall the partnership profit be distributed to the partners?

a. The industrial partner shall receive a share equivalent to the least share of a capitalist partner while the capitalist partners shall share based on capital contribution ratio

b. The industrial partner shall receive a just and equitable share and the remainder shall be distributed to the capitalist partners on the basis of capital contribution ratio.

c. The profit shall be distributed equally to all partners including the industrial partner.

d. The profit shall be distributed on the basis of loss contribution ratio which may have been agreed upon by the partners.

18. Which of the following statements is correct when a new partner is admitted to an existing partnership by purchasing a portion of a capital interest of an existing partner?

a. The partnership will recognize gain or loss in the transfer of capital from one partner to another partner.

b. It will just result to credit to capital of newly admitted partner with corresponding debit to capital of the selling partner.

c. The partnership is not dissolved by the admission of a new partner by purchase.

d. It will result to revaluation or impairment of existing assets of the partnership.

19. What is the nature of liability of limited partners as to limited partnership debts or obligations?

a. They are liable equally up to the extent of their capital contribution only.

b. They are liable pro-rata up to the extent of their separate assets after the partnership assets are exhausted

c. They are liable equally up to the extent of their separate assets after the partnership assets are exhausted.

d. They are liable pro-rata up to the extent of their capital contribution only

20.What is the nature of liability of general partners as to partnership debts or obligations?

a. They are liable equally up to the extent of their separate assets after the partnership assets are exhausted.

b. They are liable pro-rata up to the extent of their separate assets after the partnership assets are exhausted

c. They are liable solidarily up to the extent of their separate assets after the partnership assets are exhausted.

d. They are liable pro-rata up to the extent of their capital contribution only