Partnership T/F
If a new partner invest in a partnership at book value and requires a 1/4 interest in total partnership capital, it indicates that a bonus was paid to the original partners
F
A bonus to old partner's results when the new partners capital credit on the date of admittance is greater than his or her investment in the firm
F
A detailed listing of all of the assets invested by a partner in a partnership appears on the partners capital statement
F
A major advantage of the partnership form of organization is that the partners have unlimited liability
F
A partnership is an association of no more than two persons to carry on as co-owners of a business for profit
F
Each partner's initial investment in a partnership should be recorded at book value
F
If salary allowances and interest on a capital our stipulated in the partnership profit and loss sharing agreement, they are implemented only if the income is sufficient to cover the amounts required by these features.
F
In a liquidation, the final distribution of cash to partners should be on the basis of their income ratios
F
In an admission of a new partner by investment of assets, the total of the assets in total capital of partnerships do not change
F
It's a partners investment and a partnership consists of accounts receivable of $25,000 and the allowance for doubtful accounts of $7000, it would not be appropriate for the partnership to record the allowance for doubtful accounts
F
L.Hill invests the following assets in a Partnership: $15, 000 in cash, and equipment that cost $30, 000 But has a book value of $17,000 And a fair value market of $20,000. Hill, Capital will be credited for $32,000.
F
Partnership income is share in proportion to each partners capital equity interest unless the partnership contract specifically indicates the manner in which net income or net loss is to be divided
F
Partnership income or loss need not to be close to partners capital accounts each period because of the Unlimited life characteristic of partnerships
F
Salary allowances two partners are a major expense on most partnership income statements
F
The distribution of cash to partners in a partnership liquidation is always made based on the partners income sharing ratio
F
The income earned by a partner will always be greater than the income earned by a proprietor ship because in a partnership there is more than one owner contributing to the success of the business
F
The liquidation of a partnership means that a new partner has been admitted to the partnership
F
The partners drawing accounts are closed each period to the income summary account
F
The partnership agreement between partners must be in writing
F
Two proprietorships cannot combine and form a partnership
F
Unless stated otherwise in the partnership contract, profits and losses are shared among the partners in the ratio of their capital equity balances
F
Unless the partnership agreement specifically indicates an income ratio, partnership net income or loss is not allocated to the partners
F
The withdrawal of a partner legally dissolve the partnership
T
A bonus to the remaining partners results when a retiring partner receives partnership assets which are less than his or her capital balances on the date of withdrawal
T
An interest allowance and sharing partnership net income (or net loss) is related to the amount of partners invested capital during the period
T
If a new partner is admitted into a partnership by investment, the total assets in total capital will change
T
If a partner invests noncash assets into the partnership, they should be recorded by the partnership at their fair market value
T
If a partner's investment in a partnership consists of equipment that has accumulated depreciation of $8,000, It would not be appropriate for the partnership to record the accumulated depreciation
T
If a partnership has a loss for the period, the closing entry to transfer the loss to the partner will require a credit to the income summary account
T
Once assets I've been invested into the partnership, they are owned jointly by all partners
T
Partnership creditors may have a claim on the personal assets of any of the partners if the partnership assets are not sufficient to settle the claims
T
The act of any partner is binding on all other partners if the act appears to be appropriate for the partnership
T
The admission of a new partner results in the legal dissolution of an existing partnership and the beginning of a new partnership
T
The financial statements of a partnership or similar to those of a proprietorship
T
The function of the partners capital statement is to explain the changes in partners capital accounts balances during a period.
T
The personal assets, liabilities, and personal transactions of partners are excluded from the accounting records of partnerships
T
Total partners equity of a partnership is equal to the sum of all the partners capital account balances
T
