Topic 11 - T/F
A stipulation that excludes one or more partners from any share in the profits or losses is valid.
False
In the absence of a specific agreement, the law requires that partnership profits be divided equally among the partners.
False
Interest on loans from partners is recognized as partnership income.
False
It is possible to allocate profit or loss to partners based solely on interest.
False
Partnership profits and losses are divided among partners according to their sharing agreement. If no sharing agreement exists, profits or losses are divided equally.
False
Profits or losses are divided equally among the partners unless the partnership agreement specifies to the partners.
False
The form and content of the statement of comprehensive income of a partnership resemble those of a sole proprietorship with no exceptions.
False
The increase in equity of the partner due to distribution of profit can be attributed to a particular asset.
False
The salary allocation to partners also appears as salaries expense on the partnership's statement of comprehensive income.
False
When salary and interest allocations exceed profit, a loss has occurred.
False
it is possible to allocate profit or loss to partners solely on salaries.
False
the interest of partners' capital can be considered as expenses depending on partners' agreement.
False
If a partnership agreement does not specify how profits or losses are to be distributed, they should be allocated based on relative capital account balances.
True
Industrial partner is not liable for losses because he cannot withdraw the work or labor already done by him.
True
It is possible for a partner's capital account to increase as a result of the allocation of a loss.
True
It is possible to allocate profit or loss to partners based solely on average capital balances.
True
It is possible to allocate profit or loss to the partners based solely on the stated ratio.
True
The equity of a partner in the net assets of the partnership is not the same as the partner's share in the profits or losses.
True
When a loss is closed into the partners' capital accounts, income summary is credited.
True
When beginning capital balances are used in allocating profits, year-end investments are discouraged.
True
