Partnership MCQ Quiz - Objective Question with Answer for Partnership - Download Free PDF
Last updated on May 18, 2025
Latest Partnership MCQ Objective Questions
Partnership Question 1:
Three people, A, B and C, invest in a business in the ratio 2 : 3 : 5. It was decided that 9% of the profits will go to charity. If the total profit was ₹2,50,000, then find the share of C in the profit (in ₹).
Answer (Detailed Solution Below)
Partnership Question 1 Detailed Solution
Given:
Investment ratio: A : B : C = 2 : 3 : 5
Total Profit = ₹2,50,000
Charity = 9% of total profit
Formula used:
Share of C = (C's ratio / Total ratio) × (Total Profit - Charity)
Calculation:
Charity = 9% of ₹2,50,000
⇒ Charity = 0.09 × 2,50,000
⇒ Charity = ₹22,500
Remaining profit = Total profit - Charity
⇒ Remaining profit = ₹2,50,000 - ₹22,500
⇒ Remaining profit = ₹2,27,500
Total ratio = 2 + 3 + 5 = 10
Share of C = (5 / 10) × 2,27,500
⇒ Share of C = 0.5 × 2,27,500
⇒ Share of C = ₹1,13,750
∴ The correct answer is option (4).
Partnership Question 2:
Match the List-I with List-II
| LIST I Concept |
LIST II Section of Relevant Act |
||
| A | Unpaid seller | I. | S.16 of Sale of Goods Act, 1930 |
| B | Caveat emptor and its exceptions | II. | S.45 of Sale of Goods Act, 1930 |
| C | Minor admitted to benefits of partnership | III. | S.30 of Indian Partnership Act, 1932 |
| D | Registration of partnership | IV. | S.69 of Partnership Act, 1932 |
Choose the correct answer from the options given below:
Answer (Detailed Solution Below)
Partnership Question 2 Detailed Solution
The correct option is 'A - II, B - I, C - III, D - IV'.
Key Points
- Unpaid seller (A - II: S.45 of Sale of Goods Act, 1930)
- The unpaid seller is defined under Section 45 of the Sale of Goods Act, 1930.
- An unpaid seller is a person to whom the whole of the price has not been paid or tendered.
- Caveat emptor and its exceptions (B - I: S.16 of Sale of Goods Act, 1930)
- Caveat emptor means "let the buyer beware".
- Section 16 of the Sale of Goods Act, 1930, deals with the principle of caveat emptor and its exceptions.
- Minor admitted to benefits of partnership (C - III: S.30 of Indian Partnership Act, 1932)
- Section 30 of the Indian Partnership Act, 1932, deals with minors being admitted to the benefits of partnership.
- A minor can be admitted to the benefits of an existing partnership with the consent of all the partners.
- Registration of partnership (D - IV: S.69 of Partnership Act, 1932)
- Section 69 of the Indian Partnership Act, 1932, deals with the registration of firms.
- It specifies the procedure and implications of registering a partnership firm.
Therefore the correct pairing is:
A - II: Unpaid seller - S.45 of Sale of Goods Act, 1930
B - I: Caveat emptor and its exceptions - S.16 of Sale of Goods Act, 1930
C - III: Minor admitted to benefits of partnership - S.30 of Indian Partnership Act, 1932
D - IV: Registration of partnership - S.69 of Partnership Act, 1932
Partnership Question 3:
Where a partner wilfully or persistently commits breach of agreement relating to the management of the affairs of the firm or the conduct of its business, or otherwise so conduct himself in matters relating to business that it is not practicable for others to carry on business in partnership with him.
Answer (Detailed Solution Below)
Partnership Question 3 Detailed Solution
The correct answer is 'Other partner may file a suit in the court for the dissolution of the Firm.'
Key Points
- Filing a suit for dissolution:
- In cases where a partner commits a willful or persistent breach of the partnership agreement, the other partners have the legal right to file a suit in court seeking the dissolution of the firm.
- This legal action is necessary to protect the interests of the other partners and ensure that the firm's operations are not disrupted by the errant partner's actions.
- The court will evaluate the situation and, if it finds the claims valid, may order the dissolution of the firm.
Additional Information
- Other options explained:
- Other partner may decide to leave the Firm: This option is not a practical solution as it does not address the root cause of the problem and may leave the remaining partners in a difficult position.
- Firm comes to an end automatically: The firm does not dissolve automatically due to a partner's breach of agreement; a legal process must be followed.
- Other partner may decide to expel the concerned partner: Expulsion of a partner is not always a straightforward process and often requires specific provisions in the partnership agreement or a court order.
Partnership Question 4:
After dissolution of a firm public notice of dissolution is not required where
Answer (Detailed Solution Below)
Partnership Question 4 Detailed Solution
The correct answer is 'All of the above'
Key Points
- Public notice of dissolution:
- Public notice of dissolution of a firm is generally required to inform the public and creditors that the firm is no longer in operation.
- This helps in avoiding any future liabilities or misunderstandings regarding the firm's operations.
- Exceptions to public notice:
- When a partner dies, public notice of dissolution is not required because the death of a partner automatically leads to the dissolution of the firm under most partnership agreements.
- If a partner is adjudicated insolvent, public notice is not necessary as the insolvency itself is a matter of public record and triggers the dissolution of the partnership.
- For a sleeping partner (a partner who does not actively participate in the business), public notice is not required because their involvement in the business is minimal and their departure does not significantly affect the firm's operations.
- Therefore, all the given options are exceptions where public notice of dissolution is not required.
Additional Information
- Importance of public notice:
- Public notice is important in scenarios where the dissolution of a firm might affect creditors, clients, and other stakeholders.
- It helps in clarifying the status of the firm and avoids any potential legal complications.
- Legal implications:
- Failure to provide public notice when required can result in continued liability for the dissolved firm’s obligations.
- It is crucial to understand the specific legal requirements for dissolution notices in the jurisdiction where the firm operates.
Partnership Question 5:
Partnership is
Answer (Detailed Solution Below)
Partnership Question 5 Detailed Solution
The correct answer is 'Mutual agency'
Key Points
- Mutual agency:
- In a partnership, mutual agency means that each partner has the authority to act on behalf of the partnership and bind the partnership in business transactions.
- This is a fundamental characteristic of a partnership, as it allows partners to leverage their collective skills and resources to achieve common business goals.
- Mutual agency implies trust and cooperation among partners, as each partner's actions can impact the entire partnership.
Additional Information
- Trust:
- While trust is essential in any partnership, it is not a defining feature. Trust is a foundational element that supports mutual agency, but it does not constitute the legal framework of a partnership.
- Company:
- A company is a separate legal entity distinct from its owners, unlike a partnership where the partners are collectively responsible for the business. Companies are governed by different laws and regulations.
- Mutual fund:
- A mutual fund is an investment vehicle that pools money from many investors to purchase securities. It is not related to the concept of mutual agency in a partnership.
Top Partnership MCQ Objective Questions
A and B invested money in a business in the ratio of 7 ∶ 5. If 15% of the total profit goes for charity, and A's share in the profit is Rs. 5,950, then what is the total profit?
Answer (Detailed Solution Below)
Partnership Question 6 Detailed Solution
Download Solution PDFGiven:
A and B invested money in a business in the ratio of 7 ∶ 5.
15% of the total profit goes for charity, and A's share in the profit is Rs. 5,950
Calculation:
The total profit of A and B will be 5950 × 12 / 7 = Rs 10200
The total profit including charity is 10200 × 100/85 = Rs 12000
∴ The correct option is 2
A and B invested their money in a business in the ratio of 9 ∶ 5. If 10% of the total profit goes for charity and A’s share is Rs. 29,840, what is the total profit (in Rs., to the nearest integer)?
Answer (Detailed Solution Below)
Partnership Question 7 Detailed Solution
Download Solution PDFGiven:
A and B investment ratio = 9 : 5
A's share = 29840
Calculations:
A's share = 9/14 of total profit
⇒ 29840 = 9/14 × 90% of Total profit
⇒0.90 × Total profit = 14 × 29840 /9
⇒ Total profit = 46,417.78/0.90 = 51,575.30 ~ 51,575
Hence, The Required value is Rs.51,575.
Nihit starts a business with Rs. 700. After 5 months Amit and Patel joined him with Rs. 300 and Rs. 400 respectively. At the end of the year, the business gave a profit of Rs. 627. Find the share of Patel in the profit.
Answer (Detailed Solution Below)
Partnership Question 8 Detailed Solution
Download Solution PDFGiven:
Nihit's investment = Rs. 700
After 5 months,
Amit's investment = Rs. 300
Patel's investment = Rs. 400
Total profit = Rs. 627
Concept used:
Capital earned = Time of investment (in months) × Amount invested
Calculation:
Capital earned by Nihit = 12 × 700 = Rs. 8,400
Capital earned by Amit = 7 × 300 = Rs. 2,100
Capital earned by Patel = 7 × 400 = Rs. 2,800
Ratio of their capitals = 84 : 21 : 28 = 12 : 3 : 4
Total = 12 + 3 + 4 = 19
Patel's profit = \(4 \over 19\) × 627 = Rs. 132
∴ The share of Patel in the profit is Rs. 132.
Partnership Question 9:
A and B invested money in a business in the ratio of 7 ∶ 5. If 15% of the total profit goes for charity, and A's share in the profit is Rs. 5,950, then what is the total profit?
Answer (Detailed Solution Below)
Partnership Question 9 Detailed Solution
Given:
A and B invested money in a business in the ratio of 7 ∶ 5.
15% of the total profit goes for charity, and A's share in the profit is Rs. 5,950
Calculation:
The total profit of A and B will be 5950 × 12 / 7 = Rs 10200
The total profit including charity is 10200 × 100/85 = Rs 12000
∴ The correct option is 2
Partnership Question 10:
A and B invested their money in a business in the ratio of 9 ∶ 5. If 10% of the total profit goes for charity and A’s share is Rs. 29,840, what is the total profit (in Rs., to the nearest integer)?
Answer (Detailed Solution Below)
Partnership Question 10 Detailed Solution
Given:
A and B investment ratio = 9 : 5
A's share = 29840
Calculations:
A's share = 9/14 of total profit
⇒ 29840 = 9/14 × 90% of Total profit
⇒0.90 × Total profit = 14 × 29840 /9
⇒ Total profit = 46,417.78/0.90 = 51,575.30 ~ 51,575
Hence, The Required value is Rs.51,575.
Partnership Question 11:
Nihit starts a business with Rs. 700. After 5 months Amit and Patel joined him with Rs. 300 and Rs. 400 respectively. At the end of the year, the business gave a profit of Rs. 627. Find the share of Patel in the profit.
Answer (Detailed Solution Below)
Partnership Question 11 Detailed Solution
Given:
Nihit's investment = Rs. 700
After 5 months,
Amit's investment = Rs. 300
Patel's investment = Rs. 400
Total profit = Rs. 627
Concept used:
Capital earned = Time of investment (in months) × Amount invested
Calculation:
Capital earned by Nihit = 12 × 700 = Rs. 8,400
Capital earned by Amit = 7 × 300 = Rs. 2,100
Capital earned by Patel = 7 × 400 = Rs. 2,800
Ratio of their capitals = 84 : 21 : 28 = 12 : 3 : 4
Total = 12 + 3 + 4 = 19
Patel's profit = \(4 \over 19\) × 627 = Rs. 132
∴ The share of Patel in the profit is Rs. 132.
Partnership Question 12:
Three people, A, B and C, invest in a business in the ratio 2 : 3 : 5. It was decided that 9% of the profits will go to charity. If the total profit was ₹2,50,000, then find the share of C in the profit (in ₹).
Answer (Detailed Solution Below)
Partnership Question 12 Detailed Solution
Given:
Investment ratio: A : B : C = 2 : 3 : 5
Total Profit = ₹2,50,000
Charity = 9% of total profit
Formula used:
Share of C = (C's ratio / Total ratio) × (Total Profit - Charity)
Calculation:
Charity = 9% of ₹2,50,000
⇒ Charity = 0.09 × 2,50,000
⇒ Charity = ₹22,500
Remaining profit = Total profit - Charity
⇒ Remaining profit = ₹2,50,000 - ₹22,500
⇒ Remaining profit = ₹2,27,500
Total ratio = 2 + 3 + 5 = 10
Share of C = (5 / 10) × 2,27,500
⇒ Share of C = 0.5 × 2,27,500
⇒ Share of C = ₹1,13,750
∴ The correct answer is option (4).
Partnership Question 13:
Which of the following statements best describes the liability of partners in a partnership under the Partnership Act?
Answer (Detailed Solution Below)
Partnership Question 13 Detailed Solution
Correct Answer: 3. Partners are jointly and severally liable for all debts and obligations of the partnership.
Explanation: Under the Partnership Act, one of the fundamental principles is that partners in a partnership are jointly and severally liable for all debts and obligations of the partnership. This means that each partner can be held accountable for the full amount of the partnership's debts and obligations, not just a proportion equivalent to their share or investment in the partnership (contrary to option A). This liability extends to acts of other partners conducted in the course of the partnership's business, even if an individual partner did not specifically authorize them, refuting option B. Option D provides a common misunderstanding; while a new partner might not automatically assume previous debts upon entry, the partnership assets they invest in can be utilized to settle pre-existing debts, and agreements can often stipulate conditions regarding liability for past debts. Thus, option C is the correct description of partners' liability, emphasizing the communal and potentially extensive financial responsibility borne by partners within a partnership framework.
Partnership Question 14:
Match the List-I with List-II
| LIST I Concept |
LIST II Section of Relevant Act |
||
| A | Unpaid seller | I. | S.16 of Sale of Goods Act, 1930 |
| B | Caveat emptor and its exceptions | II. | S.45 of Sale of Goods Act, 1930 |
| C | Minor admitted to benefits of partnership | III. | S.30 of Indian Partnership Act, 1932 |
| D | Registration of partnership | IV. | S.69 of Partnership Act, 1932 |
Choose the correct answer from the options given below:
Answer (Detailed Solution Below)
Partnership Question 14 Detailed Solution
The correct option is 'A - II, B - I, C - III, D - IV'.
Key Points
- Unpaid seller (A - II: S.45 of Sale of Goods Act, 1930)
- The unpaid seller is defined under Section 45 of the Sale of Goods Act, 1930.
- An unpaid seller is a person to whom the whole of the price has not been paid or tendered.
- Caveat emptor and its exceptions (B - I: S.16 of Sale of Goods Act, 1930)
- Caveat emptor means "let the buyer beware".
- Section 16 of the Sale of Goods Act, 1930, deals with the principle of caveat emptor and its exceptions.
- Minor admitted to benefits of partnership (C - III: S.30 of Indian Partnership Act, 1932)
- Section 30 of the Indian Partnership Act, 1932, deals with minors being admitted to the benefits of partnership.
- A minor can be admitted to the benefits of an existing partnership with the consent of all the partners.
- Registration of partnership (D - IV: S.69 of Partnership Act, 1932)
- Section 69 of the Indian Partnership Act, 1932, deals with the registration of firms.
- It specifies the procedure and implications of registering a partnership firm.
Therefore the correct pairing is:
A - II: Unpaid seller - S.45 of Sale of Goods Act, 1930
B - I: Caveat emptor and its exceptions - S.16 of Sale of Goods Act, 1930
C - III: Minor admitted to benefits of partnership - S.30 of Indian Partnership Act, 1932
D - IV: Registration of partnership - S.69 of Partnership Act, 1932
Partnership Question 15:
Arrange the following as per the order of sections under the Partnership Act, 1932:
A. Partnership at will
B. Property of the firm
C. Holding out
D. Dissolution of a firm
E. Effect on Non-Registration of a Partnership firm
Choose the correct answer from the options given below:
Answer (Detailed Solution Below)
Partnership Question 15 Detailed Solution
The correct answer is Option 2.
Key Points