partnership liquidation

partnership liquidation

University

20 Qs

quiz-placeholder

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Partnership Dissolution

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partnership liquidation

partnership liquidation

Assessment

Quiz

Business

University

Easy

Created by

TeaTi Moh

Used 6+ times

FREE Resource

20 questions

Show all answers

1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Lump sum liquidation method requires that all assets are converted into cash, all liabilities are paid, and all profits and losses are charged to the partners, followed by a single distribution of cash.

 t

f

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The process of removing the debit balance of a partner through his existing loan account is called exercising the right of off set.

t

f

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Dissolution always results to liquidation.

t

f

Answer explanation

Dissolution does not always result to liquidation.

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

In liquidation, cash should be distributed first to outside creditors.

t

f

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Gain or loss on realization is divided among the partners according to their capital contributions.

t

f

Answer explanation

according to P&L agreement instead of capital contributions

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The loss absorption potential is the maximum loss each partner can absorb and which can eliminate him from any cash distribution.

t

f

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

In the partnership liquidation statement, assets are generally classified as cash and non-cash assets. 

t

f

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