This is second quiz on the meaning of partnership with 15 practice questions. Test your knowledge about the meaning of partnership with this MCQ practice test. This quiz contains questions 1-15 covering meaning and features of partnership, the rights of partners, Partnership deed and its importance and provisions in the absence of partnership deed and liabilities of partners in case of unjust profits earned from firm. Answer all questions and get instant feedback with detailed explanations. The quiz suits well for conceptual clarity for your board exams
How to attempt the quiz
One by one go through the below questions and select the right option. Do all the questions and in the end press submit. Instantly you will get your score and the explanation against each question. Go through your mistakes and reattempt the quiz any number of times as needed.
MCQ Quiz - Practice Questions
MCQ Quiz
Question 1
Partners have the right to:
A
Correct Answer: Inspect books of account and have a copy
Every partner has the right to inspect the books of account and have a copy of it.
Question 2
A new partner can be admitted only when:
C
Correct Answer: All existing partners consent
A partner has the right not to allow admission of new partner. New partner cannot be admitted unless all partners agree.
Question 3
If partner earns commission from seller on goods purchased by firm, the commission:
B
Correct Answer: Shall be paid to the firm
If a partner earns profit for himself from any transaction of the firm or from use of firm's property, the profit shall be paid to the firm.
Question 4
A partner can retire from firm:
B
Correct Answer: After giving notice or with consent
After giving notice, a partner has the right to retire from the firm or with consent of all other partners.
Question 5
If partner carries on competing business without consent and earns profit:
B
Correct Answer: Profit paid to firm, losses borne by him
If a partner carries on business in competition without consent and earns profit, the profit shall be paid to the firm. However, losses are borne by him alone.
Question 6
Partnership Deed is:
B
Correct Answer: A written document detailing partnership terms
Partnership Deed is a written document detailing the terms and conditions of partnership signed by all partners.
Question 7
In absence of Partnership Deed, interest on capital is:
B
Correct Answer: Not allowed
As per Partnership Act, 1932, interest on capital is not allowed to partners in absence of Partnership Deed.
Question 8
In absence of Partnership Deed, profits and losses are shared:
C
Correct Answer: Equally
As per Partnership Act, 1932, profits and losses are shared equally by partners in absence of Partnership Deed.
Question 9
Interest on loan by partner, when rate is not agreed, is allowed at:
C
Correct Answer: 6% p.a.
Interest on advance/loan by partner is paid at 6% p.a. as per Partnership Act, 1932 if rate is not agreed.
Question 10
In absence of Partnership Deed, interest on drawings is:
B
Correct Answer: Not charged
As per Partnership Act, 1932, interest on drawings is not charged from partners in absence of Partnership Deed.
Question 11
Salary to partners, when Partnership Deed does not exist, is:
C
Correct Answer: Not allowed
Remuneration (salary, commission, etc.) is not allowed to partners as per Partnership Act, 1932 in absence of Partnership Deed.
Question 12
Partnership Deed must be signed by:
A
Correct Answer: All partners
Partnership Deed is a legal document signed by all the partners.
Question 13
Which is typically not a clause in Partnership Deed?
D
Correct Answer: Employee attendance records
Partnership Deed includes profit-sharing ratio, capital contribution, interest rates, salary/commission, and other partnership terms, not employee attendance.
Question 14
Interest on loan by partner is:
B
Correct Answer: A charge against profit paid even if loss occurs
Interest on loan by partner is a charge against profit, meaning it is paid whether firm earns profit or incurs loss.
Question 15
When Partnership Deed is silent on a matter, which Act's provisions apply?
C
Correct Answer: Indian Partnership Act, 1932
If Partnership Deed does not exist or is silent on a matter, provisions of Indian Partnership Act, 1932 apply.
