Obligations of the Partnership and Partners

Multiple Choice Questions 1-6

1.Statement I.- The profits and losses of the partnership shall be dividedamong the partners if they have no profit and loss sharing agreement .

Statement II. - A stipulation exempting the capitalist partner from losses is valid.

a.Statement I is correct, and Statement II is incorrect.

b.Statement I is incorrect, and Statement II is correct.

c.Statements I and II are correct.

d.Statements I and II are incorrect.

2.Statement I. - A newly admitted partner is liable for partnership debtscontracted before his admission to the extent of his contribution , unless there is contrary stipulation.

Statement II. - A partner may associate anotherperson with him in his share, but the person associated shall not be admitted to the partnership without the consent of all the partners.

a.Statements I and II are correct.

b.Statements I and II are incorrect.

c.Statement I is correct, and Statement II is incorrect.

d.Statement I is incorrect, and Statement II is correct.

3.Statement I. - The partnership shall be solidarily liable with all the partnersif one partner acting within the scope of his authority receives a money or property of a third person and misapplies it.

Statement II. - When a partner is not authorized to act for the partnership and the act of the partner is not for apparently carrying on the business of the partnership shall be bound by the act of such partnerif the third person was not unaware of the partner's lack of authority.

a.Both statements are correct.

b.Both statements are incorrect

c.Statement I is correct, and statement II is incorrect.

d.Statement I is incorrect, and Statement II is correct.

4.The following statements pertain either to partner appointed as manager in the articles of partnership or through a document after the formation of the partnership.

I.He may be removed as manager only for a just or lawful cause by the vote of the partners owning the controlling interest.

II.He may be removed as manager with or without just or lawful cause by the vote of the partners owning the controlling interest.

III.He may perform all acts of administration despite the opposition of his partners provided he is in good faith.

IV.He may perform all acts of administration in good faith but opposing partners may resort to his removal if he persists.

Based on the foregoing :

a.I and IIIpertain to a partnerappointed as manager in the articles of partnership.

b.I and III pertain to a partner appointed as manager through a documentafter the formation of the partnership.

c.II and III pertain to a partnerappointed through a document after the formation of the partnership.

d.I and IV pertain to a partner appointed as manager in the articles of partnership.

5.It refers to the pro rata liability for partnership obligations of the partnersincluding industrial ones , to the extent of their separate property after partnership assets have been exhausted.

a.Subsidiary liability

b.Secondary liability

c.Primary liability

d.None of the foregoing.

6.Statement I. - Persons who, not being partners, include their names in the firm name do not acquire the rights of a partner but they shall be subject the liability of a partner in so far as third persons without notice are concerned.

Statement II. - All partners including industrial ones , shall be liable pro rata with all their propertyand after all the partnership assetshave been exhausted for the contract which may have been entered into in the name of the partnership.

a.Both statements are incorrect.

b.Both statements are correct.

c.Statement I is correct, and Statement II is incorrect.

d.Statement I is incorrect, and Statement II is correct.