15. Which of the following statements is correct concerning the similarities between a limited partnership and a corporation? a. Each is created under a statute and must file a copy of its certificate with the proper state authorities. b. All corporate stockholders and all partners in a limited partnership have limited liability c. Both are recognized for federal income tax purposes as taxable entities, d. Both are allowed statutorily to have perpetual existence. Items 19 and 20 are based on the following: Dowd, Elgar, Frost, and Grant formed a general partnership. Their written partnership agreement provided that the profits would be divided so that Dowd would receive 40%, Elgar, 30%, Frost 20%; and Grant, 10%. There was no provision for allocating losses. At the end of its first year, the partnership had losses of $200,000. Before allocating losses, the partners' capital account balances were: Dowd, $120,000; Elgar, $100,000; Frost, $75,000; and Grant, $11,000. Grant refuses to make any further contributions to the partnership. Ignore the effects of federal partnership tax law. 16. Cass is a general partner in Omega Company general partnership. Which of the following unauthorized acts by Cass will bind Omega? a. Submitting a claim against Omega to arbitration, b. Confessing a judgment against Omega c. Selling Omega's goodwill. d. Leasing office space for Omega. 19. What would be Grant's share of the partnership losses? a. $9,000 b. $20,000 c. $39,000 d. $50,000 17. Which of the following statements is correct regarding the division of profits in a general partnership when the written partnership agreement only provides that losses be divided equally among the partners? Profits are to be divided a. Based on the partners' ratio of contribution to the partnership b. Based on the partners' participation in day to day management c. Equally among the partners. d. Proportionately among the partners. 20. After losses were allocated to the partners' capital accounts and all liabilities were paid, the partnership's sole asset was $106,000 in cash. How much would Elgar receive on dissolution of the partnership? a. $37,000 b. $40,000 c. $47,500 d. $50,000 18. The partnership agreement for Owen Associates, a general partnership, provided that profits be paid to the partners in the ratio of their financial contribution to the partnership. Moore contributed $10,000, Noon contributed $30,000, and Kale contributed $50,0000. For the year ended December 31, 1993, Owen had losses of $180,000. What amou of the losses should be allocated to Kale? a. $40,000 b. $60,000 c. $90,000 d. $100,000 21. Which of the following statements best describes the effect of the assignment of an interest in a general partnership? a. The assignee becomes a partner. b. The assignee is responsible for a proportionate share of past and future partnership debts. C. The assignment automatically dissolves the partnership d. The assignment transfers the assignor's interest in partnership profits and surplus. 15. Which of the following statements is correct concerning the similarities between a limited partnership and a corporation? a. Each is created under a statute and must file a copy of its certificate with the proper state authorities. b. All corporate stockholders and all partners in a limited partnership have limited liability c. Both are recognized for federal income tax purposes as taxable entities, d. Both are allowed statutorily to have perpetual existence. Items 19 and 20 are based on the following: Dowd, Elgar, Frost, and Grant formed a general partnership. Their written partnership agreement provided that the profits would be divided so that Dowd would receive 40%, Elgar, 30%, Frost 20%; and Grant, 10%. There was no provision for allocating losses. At the end of its first year, the partnership had losses of $200,000. Before allocating losses, the partners' capital account balances were: Dowd, $120,000; Elgar, $100,000; Frost, $75,000; and Grant, $11,000. Grant refuses to make any further contributions to the partnership. Ignore the effects of federal partnership tax law. 16. Cass is a general partner in Omega Company general partnership. Which of the following unauthorized acts by Cass will bind Omega? a. Submitting a claim against Omega to arbitration, b. Confessing a judgment against Omega c. Selling Omega's goodwill. d. Leasing office space for Omega. 19. What would be Grant's share of the partnership losses? a. $9,000 b. $20,000 c. $39,000 d. $50,000 17. Which of the following statements is correct regarding the division of profits in a general partnership when the written partnership agreement only provides that losses be divided equally among the partners? Profits are to be divided a. Based on the partners' ratio of contribution to the partnership b. Based on the partners' participation in day to day management c. Equally among the partners. d. Proportionately among the partners. 20. After losses were allocated to the partners' capital accounts and all liabilities were paid, the partnership's sole asset was $106,000 in cash. How much would Elgar receive on dissolution of the partnership? a. $37,000 b. $40,000 c. $47,500 d. $50,000 18. The partnership agreement for Owen Associates, a general partnership, provided that profits be paid to the partners in the ratio of their financial contribution to the partnership. Moore contributed $10,000, Noon contributed $30,000, and Kale contributed $50,0000. For the year ended December 31, 1993, Owen had losses of $180,000. What amou of the losses should be allocated to Kale? a. $40,000 b. $60,000 c. $90,000 d. $100,000 21. Which of the following statements best describes the effect of the assignment of an interest in a general partnership? a. The assignee becomes a partner. b. The assignee is responsible for a proportionate share of past and future partnership debts. C. The assignment automatically dissolves the partnership d. The assignment transfers the assignor's interest in partnership profits and surplus