Reference no: EM131578525

1. When a partnership is dissolved, which of the following is the proper order of distribution?

a. Salary and loans owed to partners, outside creditors, partner capital contributions, undistributed profits.

b. Outside creditors, salary and contributions, undistributed profits.

c. Outside creditors, salary and loans owed to partners, undistributed profits, partner capital contributions.

d. None of the above.

2. In a general partnership, the authorization of all partners is required for an individual partner to bind the partnership in a business transaction to:

a. purchase inventory.

b. hire employees.

c. sell goodwill.

d. sign advertising contracts.

3. Vick Tracy became homeless at a very young age and was taken in by aunt and uncle. Many years later, Tracy became a detective for the city police department. When his aunt disappeared and was not heard from for a month, the case was assigned to Tracy. His uncle also came to Tracy and asked him to promise to find his aunt in return for the years of support. Tracy agreed.

a. Tracy's duty to find his aunt is based on fraud.

b. Tracy has no contractual duty to find his aunt.

c. If his uncle also promised Tracy $1000 for finding his aunt, he would be liable when Tracy found her.

d. Tracy will be liable for breach of contract if he doesn't find his aunt.

4. Tony Truckdriver, a partner of We Haulit, was driving a partnership truck when he took his eye off the road and ran over the late Pete Pedestrian. Tony was delivering goods to customers of the partnership when the accident occurred.

a. Tony can be liable for his negligence.

b.The partnership can be hel liable for Tony 's negligence.

c. If the partnership is held liable, the partnership would not have cause of action against Tony.

d. Two of the above.

e. Unable to determine from the above limited facts.