Reference no: EM132935087
Problem 1: S1: In a partnership liquidation, if a partner's personal liabilities exceed personal assets then the partner is personally insolvent.S2: Cash Priority Program is the schedule prepared to determine the amount of payment prioritized to each partners.
a. Both statements are true
b. S1 True; S2 False
c. Both statements are false
d. S2 True; S1 False
Problem 2: S1: Forming a partnership requires two or more people agreeing to be partners contributing all their personal properties. S2: Oral agreements of partners are not allowed
a. Statement 1 is true.
b. Statement 2 is true.
c. Both statements are false.
d. Both statements are true.
Problem 3: S1: Joint Control is present if tow ore more parties have greater than 50% Control.S2: One Party has more than 50% in a joint arrangement
a. Both statements are false
b. S2 True; S1 False
c. S1 True; S2 False
d. Both statements are true
Problem 4: S1: In a partnership, at least one partner is required to be a/an limited partner in order to ensure partnership creditors will be paid and protectedS2: Unpaid liabilities should be included in computing for the total loss attributed to the partners.
a. S1 True; S2 False
b. Both statements are false
c. S2 True; S1 False
d. Both statements are true
Problem 5: S1: If the total contributed capital of the partnership is greater than the total agreed capital, it is possible that a goodwill be recognized or an undervaluation of asset occurred.S2: Noncash assets sold by the partnership will prioritize payment of Creditors
a. S1 True; S2 False
b. Both statements are false
c. Both statements are true
d. S2 True; S1 False
Problem 6: Merchandise invested by an entity under a joint operation agreement should include an entry of
a. Credit to merchandise inventory of the Joint Operator who contributed merchandise
b. Credit to merchandise Inventory of all the Joint Operators
c. Debit to Joint Operation under the books of the Joint Operators other than the party who invested
d. Credit to Joint Operation under the books of the party investing the merchandise
Problem 7: The interest of the retiring or withdrawing partner is usually measured by his capital balance before his retirement or withdrawal adjusted by the following adjustments except
a. changes in the valuation of all assets and liabilities
b. profit or loss from the operation from the last closing date of the date of his retirement or withdrawal
c. errors in net income in prior years
d. profit or loss after the date of the partner's withdrawal or retirement