All partnerships have multiple capital accounts.

1. All partnerships have multiple capital accounts.

A)

True

B)

False

2.

Partnerships pay no income tax.

A)

True

B)

False

3.

According to GAAP, partners need to follow the Cost Principle when recrording their initial investment in a newly formed the firm.

A)

True

B)

False

4.

Based on work done in class, it's safe to say that when partnerships dissolve, assets are sold and debts are paid.

A)

True

B)

False

5.

Originally, partners in large accounting firms, like KPMG and Ernst & Young for example, had unlimited liability.

A)

True

B)

False

6.

Assets invested into a partnership are recorded as credits.

A)

True

B)

False

7.

Recording Myer's investment in EX 12-2 starting on page 579 would require a $9,200 credit to Allowance for Doubful Accounts.

A)

True

B)

False

8.

According to the partnership agreement in part c of EX 12-3 on page 580, Albright would earn a $3,500 return on her original investment in the firm.

A)

True

B)

False

9.

The admission of Cruz in EX 12-10 on page 581 liquidates the original partnership of Abrams and Santori.

A)

True

B)

False

10.

The journal entries in parts a and b of EX 12-10 would be exactly the same.

A)

True

B)

False

11.

Marley's retirement in EX 12-17 on page 583 results in the liquidation of Marley and Associates.

A)

True

B)

False

12.

Adjusting the net asset value of Moshref and Hollins in PR 12-4A starting on page 587 would require a $4,600 debit to inventory.

A)

True

B)

False

13.

In part a of PE 12-3A on page 578, land would be debited for $150,000.

A)

True

B)

False

14.

Rodriquez received a bonus for joining the partnership in PE 12-4A on page 578.

A)

True

B)

False

15.

Analysis of PE 12-5A on page 578 indicates that Parker and Xi could not afford to pay off their creditors.

A)

True

B)

False

16.

A loss is incurred on realization when noncash assets are sold for less than they're worth.

A)

True

B)

False

17.

A loss on realization can result in multiple capital deficiencies.

A)

True

B)

False

18.

When the liquidation process is complete, any remaining cash is returned to partners according to their profit sharing agreement.

A)

True

B)

False

19.

Based on work done in class it's safe to assume that liability accounts will be always be debitied when debts are paid during the liquidation process.

A)

True

B)

False

20.

A partnership with $X in debt and $Y in assets would have $X + $Y in equity.

A)

True

B)

False