Reference no: EM132786865

Problem 1: The partnership characteristic of co-ownership of property states that:

a. all partnership assets are co-owned by any banks making loans to the partnership

b. general partners co-own all assets, but limited partners do not

c. general partners own a larger percentage of the assets of a partnership than do limited partners

d. any asset a partner invests in the partnership becomes the joint property of all the partners

Problem 2: A partner contributes, as part of her initial investment, accounts receivable with an allowance for doubtful accounts. Which of the following reflects a proper treatment?

a. The balance of the accounts receivable account should be recorded on the books of the partnership at its net realizable value.

b. The allowance account may be set up on the books of the partnership because it relates to the existing accounts that are being contributed.

c. The allowance account should not be carried onto the books of the partnership.

d. The accounts receivable and allowance should not be recorded on the books of the partnership because a partner must invest cash in the business.

Problem 3: When an individual partner uses personal assets to pay partnership creditors, this payment is considered as

a. An investment of capital in the partnership.

b. A liability to the partnership

c. A receivable owing to the partnership

d. A reduction in a partnership asset