Proprietor for debts and obligations of the sole proprietors

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Reference no: EM132267805

1. Which of the following is true of partnerships?

a. General partners are jointly and severally liable for debts and obligations of the partnership.

b. In a general partnership, there is one general partner designated to make management decisions.

c. General partners are only liable for debts and obligations of the partnership to the extent of their capital contributions.

d. In the absence of an agreement to the contrary, general partners share profits pro rata according to their capital contributions.

2. With regard to the liability of the sole proprietor for debts and obligations of the sole proprietorship, which of the answer choices is true?

a. The sole proprietor is legally liable for the debts and obligations of the sole proprietorship, unless the proprietorship uses a d/b/a.

b. The sole proprietor is legally liable for the debts and obligations of the sole proprietorship, whether or not the proprietorship uses a d/b/a.

c. The sole proprietor is legally liable for the debts and obligations of the sole proprietorship, only to the extent of the net assets of the proprietor at the time the obligation is incurred.

d. The sole proprietor is legally liable for the debts and obligations of the sole proprietorship, only if the proprietor signed a legally enforceable guaranty.

3. With regard to continuation of a dissolved partnership, which of the following is NOT true?

a. Because the partnership is continuing, old partners are not liable for the debts and obligations of the old partnership.

b. Creditors of the old partnership become creditors of the new partnership.

c. A continuation agreement would define events that allow continuation, as well as what payments outgoing partners are entitled to.

d. Old partners are liable for debts and obligations as of the time of dissolution, but not new debts.

4. Which of the following partners in a limited partnership invest capital, manage the business, and are personally liable for partnership debts?

a. sole proprietors

b. limited partners

c. specific partners

d. general partners

Reference no: EM132267805

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