INDIAN PARTNERSHIP ACT,1932

1.Which one of the following statements is True' in partnership?

In the absence of any provision in the partnership deed, only a working partner is entitled to
remuneration.
Any firm which earns normal profit has no goodwill.
The business of the firm must be carried on by all the partners.
Interest on loan given by a partner to the firm shall be paid if there are profits.
Option 2 : Any firm which earns normal profit has no goodwill.
2.Which of the following are false?
A. Partners are not bound to carry on the business of the firm to the greatest common advantage
B. Where a partner is entitled to interest on capital subscribed by him, such interest shall be payable
whether or not there are profits
C. An outgoing partner has a right to claim a share in the profits of the firm till his account is finally
settled
D. A partner may be expelled from the firm only with the consent of all other partners
Choose the correct answer from the options given below:
A, B, D only
A, C, D only
B, D, C only
C, D only
Answer Option 1 : A, B, D only
3. Which one of the following statements is True' in partnership?
In the absence of any provision in the partnership deed, only a working partner is entitled to
remuneration.
Any firm which earns normal profit has no goodwill.
The business of the firm must be carried on by all the partners.
Interest on loan given by a partner to the firm shall be paid if there are profits.
Answer Option 2 : Any firm which earns normal profit has no goodwill.
4.Which kind of partnership one partner has unlimited liability and other partner have limited
liability?
Partnership-at-will
Limited partnership
General partnership
Particular partnership
Option 2 : Limited partnership
5.. Which of the following are false?
A. Partners are not bound to carry on the business of the firm to the greatest common advantage
B. Where a partner is entitled to interest on capital subscribed by him, such interest shall be payable
whether or not there are profits
C. An outgoing partner has a right to claim a share in the profits of the firm till his account is finally
settled
D. A partner may be expelled from the firm only with the consent of all other partners
Choose the correct answer from the options given below:
A, B, D only
A, C, D only
B, D, C only
C, D only
Option 1 : A, B, D only
6. Under Limited Liability Partnership Act, 2002. Foreign Limited Liability Partnership
means____________.
Partnership formed, incorporated in India.
Partnership formed, incorporated or registered outside India.
Partnership formed, incorporated or registered in India.
Partnership formed, incorporated or registered outside in India which establishes a place of business
within India.
None of these.
Option 4 : Partnership formed, incorporated or registered outside in India which establishes a place
of business within India.
7.In case of partnership, which of the following statement is not true?
Partnership is not a legal entity
Two partnership firm can form a partnership firm
Two companies can from a partnership firm
Maximum number of partners in case of banking activity is 10
Maximum number of partners in case of non-banking activity is 20
Option 2 : Two partnership firm can form a partnership firm
8/ When did the Indian Partnership Act come into force?
A) 01 April 1934
B) 01 March 1933
C) 01 May 1919
D) 01 october 1932
Answer –D) 01 October 1932
9/ Which section of the Indian Partnership Act, 1932 deals with the Duty to indemnify for loss caused by
fraud?
A. Section 12 of the Indian Partnership Act, 1932
B. Section 10 of the Indian Partnership Act, 1932
C. Section 14 of the Indian Partnership Act, 1932
D. Section 20 of the Indian Partnership Act, 1932
Answer B. Section 10 of the Indian Partnership Act, 1932
10/ Which section of the Indian Partnership Act, 1932 deals with Personal profits named by partners_?
A. Section 16 of the Indian Partnership Act, 1932
B. Section 24 of the Indian Partnership Act, 1932
C. Section 13 of the Indian Partnership Act, 1932
D. Section 18 of the Indian Partnership Act, 1932
Answer – A. Section 16 of the Indian Partnership Act, 1932
11/ Section 35 of the Indian Partnership Act, 1932 deals with_______?
A. Liability of the estate of a deceased partner
B. Liability of the firm for misapplication by partners
C.Expulsion of a partner.
D. Compulsory dissolution
Ans-A. Liability of the estate of a deceased partner
12/ Dissolution on the happening of certain contingencies, is provided in section____ of the Indian
Partnership Act, 1932.
A. Section 41 of the Indian Partnership Act, 1932
B. Section 11 of the Indian Partnership Act, 1932
C. Section 42 of the Indian Partnership Act, 1932
D. Section 21 of the Indian Partnership Act, 1932
Ans- C. Section 42 of the Indian Partnership Act, 1932
13/ Section 25 of the Indian Partnership Act, 1932 provides _?
A..liability of a partner for acts of the firm
B. Holding out..
C.Expulsion of a partner.
D. Dissolution of a firm
Ans- A..liability of a partner for acts of the firm
14. Which section of the Indian Partnership Act, 1932 deals with Right to restrain from use of firm-name
or firm-property?
A. Section 72 of the Indian Partnership Act, 1932
B. Section 57 of the Indian Partnership Act, 1932
C. Section 53 of the Indian Partnership Act, 1932
D. Section 59 of the Indian Partnership Act, 1932

Answer – C. Section 53 of the Indian Partnership Act, 1932

15. Section 40 of the Indian Partnership Act, 1932 deals with_______?
A. Dissolution by agreement
B.Dissolution by the Court
C. Introduction of a partner
D. Insolvency of a partner
Ans-A. Dissolution by agreement
16/ Which section of the Indian Partnership Act, 1932 deals with the Right of outgoing partners to carry
on competing business. ?
A. Section 22 of the Indian Partnership Act, 1932
B. Section 36 of the Indian Partnership Act, 1932
C. Section 43 of the Indian Partnership Act, 1932
D. Section 45 of the Indian Partnership Act, 1932
Answer B. Section 36 of the Indian Partnership Act, 1932
17) Section 10 of the Indian Partnership Act, 1932 deals with_______?
A.Application of the property of the firm.
B.Partner to be an agent of the firm
C.Duty to indemnify for loss caused by fraud.
D. The property of the firm
Answer- C .Duty to indemnify for loss caused by fraud.
18. Under Section 2(b) of the Indian Partnership Act, ‘business’ Includes
(a) every trade and occupation
(b) every occupation and profession
(c) every trade, occupation and profession
(d) every trade and profession
Ans.C
19. State which of the statements is true?
(a) Partner is an agent of the firm
(b) Partner is owner of the firm
(c) Partner is director of the firm
(d) None of the above
Ans.A
20. What is a partnership at will?
(a) Created under a will by testator
(b) Created by consent of all partners
(c) Partnership without provision for duration
(d) None of the above
Ans.C
21. A partnership not for any fixed duration is
(a) partnership at will
(b) indissoluble partnership
(c) either (a) or (b)
(d) none of the above
Ans.A
22. Which of the following is a strong but not sufficient test of
partnership
(a) sharing of profits
(b) sharing of losses
(c) either of the two
(d) none of the above
Ans.A
23. In which of the following cases, a partnership exist:
(a) Several persons jointly purchase goods for resale with a view to
divide the profits arising from the transaction.
(b) Persons (co-owners) who join in the purchase of goods for the
purpose of dividing the goods themselves.
(c) A. B and C agreed that each should furnish Rs. 3000 worth of goods
to be shipped on a joint venture, the profits is to be divided between
them according to the amount of their several shipments
(d) Two tenants in common of a house and divide the rent equally
Ans.A
24. In which of the following cases a partnership does not exist?
I. Lender of money receiving profit
II. Servants or agents receiving profit
III. Widow or child of a deceased receiving profits.
IV. Seller of goodwill receiving profits
(a) I, II and III
b) I, II and IV
(c) II, III and IV
d) All of the above
Ans.D
25. A partnership firm is
(a) a distinct legal entity from its partner
(b) not a distinct legal entity from its partner
(c) a juristic person
(d) None of the above
Ans.B
26. A partner can retire by notice of intention to retire, where
(a) the partnership is at will
(b) the partnership is for a specified period
(c) where a contract has been made between the partners for its
determination
(d) none of the above
Ans.A
27. In a partnership at will
(a) a partner of a firm can retire from firm at any time by giving a notice
of his intention to retire to his co-partner
(b) a partner of a firm can dissolve the at any time by giving a notice of
intention to dissolve the firm to his co partners
(c) either (a) or (b)
(d) neither (a) nor (b)
Ans.C
.28 Where a partnership firm is constituted a fixed period and after
the expiration that term the firm continues to carry business without
any agreement
A) the partnership stands extended till the new agreement is made
B) The partnership becomes the partnership at will
C) The partnership becomes illegal
D) the partnership stands dissolved on the date of the expiry of the
term and no partnership can be said to be in existence
Ans.B
29. As per Section 5 of the Indian Partnership Act, the relationship of
partnership is created by:
a) Status
(b) Contract
(c) Statute
d) None of the above
Ans.B
30. Partnership” means
(a) joint venture
(b) agreement between the persons to share the profit of a business
carried on between them
(c)agreement between the persons to do some work
(d) none of the above
Ans.B
31.The relation of partnership according to Section 5 of Indian
Partnership Act, 1932 arises from
(a) status
b) Contract
(c) friendship
d) None of these
Ans.B
32. The mode of determining the existence of partnership has been
laid down in
(a) Section 5
b) Section 6
(c) Section 9
d) Section 10
Ans.B
33. A partnership for which no period or duration is fixed, under the
Partnership Act, 1932 known as
(a) General partnership
(b) Partnership at will
(c)Particular partnership
(d) Co-ownership
Ans.B
34. Which of the following is not an essential requisite for creating a
partnership as per Section 4 of the Partnership Act?
a) An agreement to carry on a business
(b) Sharing of profits
(c) Sharing of losses
(d) Business to be carried by all or any of them acting for all
Ans.C
35. An act, to be called on ‘act of a firm’, within meaning of Section
2(a) of the Indian Partnership Act, 1932 is-
(a) Every act of the partners
b) Only such acts which give rise to a right enforceable by or against the
firm
(c) Such acts which do not give rise to a right enforceable by or against
the firm
d) Either (a) or (b) or (c)
Ans.B
36. Which of the following is a valid partnership?
a) Partnership between two partnership firm
(b) Partnership between one partnership firm and an individual
(c) Partnership between individual members of one firm and the
individual members of another firm
(d) Neither (a) nor (b) nor (c).
Ans.D
37. The most important gesture of a ‘partnership at will is:
(a) Sharing of losses
(b) Registration not needed
(c) Easy dissolubility
(d) Utmost Transparency
Ans.C
38. Goodwill of a partnership business is the property of the
partnership
(a) Under Section 14
(b) Under Section 13
(c) Under Section 12
(d) Under Section 11
Ans.A
39. If a partner chooses to use any assets of the partnership firm for
his own purpose it gives rise to
(a) civil liability of the partner
(b) criminal liability of the partner
(c) Both (a) and (b)
(d) Either (a) or (b)
Ans.A
40. Under Section 10, every partner has a duty to indemnify the firm
for any loss caused to the firm by his the conduct of the business of
the firm.
(a) Negligence
(b) Wrongful act
(c) Fraud
(d) All of the above
Ans.C
41. Z and W are partners in a stationery business. Z orders on the
firm’s letter head to supply two bags of wheat at his residence. What
will be the liability of the firm under the Indian Partnership Act, 1932?
(a) The firm is not liable to pay the debt
(b) The firm is liable to pay the debt
(c) The firm is liable only for half of the debt
(d) None of the above
Ans.A
42. A partner has no implied authority
(a) to enter into a partnership with other persons in another business
(b) to borrow money in case of commercial firm
(c) either (a) or (b)
(d) neither (a) nor (b)
Ans.A
43. An agreement in restraint of trade in a partnership under Section
11 of the Indian Partnership Act is
(a) valid
b) Voidable
(c) void
d) Illegal
Ans.A
44. The historic case laying down the test for determining the
existence of partnership is
(a) Grave v. Smith
(b)Bloream v Pell
(c) Mingh v. Carver
(d) Car v. Hickman
Ans.D
45. General duties of partners have been laid down in
(a) Section 9 of the Act
(b) Section 10 of the Act
(c) Section 11 of the Act
(d) Section 13 of the Act
Ans.A
46. Goodwill of the partnership business is the property of
partnership under
(a) Section 14
(b) Section 16
(c)Section 15
(d) Section 17(b)
Ans.A
47. The authority of a partner to bind the firm by his acts done in the
usual course of business is called his “implied authority”. Such
authority does not include:
(a) Selling the firm’s goods.
(b) To borrow in a trading firm.
(c) Settling accounts with the persons dealing with the firm.
(d) Withdraw a suit or proceeding filed on the firm’s behalf.
Ans.D
48. According to Sec. 30 of the Partnership Act, “at any time within 6
months of his attaining majority or of obtaining knowledge that he
had been admitted to the benefits of partnership, whichever date is
later, a minor can elect to become or not to become a partner.”
(a) Such option is exercised by giving a public notice.
(b) If he remains silent and fails to give such a notice there is a
presumption that he wants to be a partner and on the expiry of the said
6 months he shall become a partner in the firm.
(c) if he did not exercise the option, he will be deemed to become a
partner in firm.
(d) All are correct.
Ans.D
49. Which of the following Sections defines the doctrine of holding
out, creating the liability of a ‘Non-partner under Indian Partnership
Act?
(a) Section 28
(b)Section 30
(c) Section 2)
(d) Section 31
Ans.A
50. A minor, who has been admitted o to the benefits of the
partnership under section 30(5) of the Indian Partnership Act on
attaining majority has to exercise option, to stay or to leave the firm,
within
(a) one month of attaining majority
(b) six months of attaining majority
(c) 90 days of attaining majority
(d) none of the above
Ans.B
51. A firm can be held liable for the wrong act of a partner where the
act has been ratified by the partners, provided
(a) the act could be legally done with the authority of the partners
(b) the partners ratify the act with knowledge of the facts
(c) neither (a) nor (b)
(d) both (a) and (b)
Ans.D
5. The Doctrine of Holding Out is mentioned in
(a) Section 25 of the Indian Partnership
(b) Section 28 of the Indian Partnership
(c) Section 29 of the Indian Partner
(d) None of the above
Ans.B
53. Which one of the following is not correct matched:
(a) Definition of Partnership – Section 4
(b) Partnership at Will- Section 7
(c) Expulsion of Partner – Section 33
(d) Authority of Partner in Emergency -Section 23
Ans.D
54. Which is incorrect regarding Implied authority of a partner
(a) he can compromise suits or behalf of firm
(b) he can transfer immovable properties of firm
(c) he can enter into partnership on behalf of the firm
(d) all of the above
Ans.D
55. By implied authority, each partner because other partners by his
acts in all matter which are within the scope and objection of
partnership. In a partnership of general commercial nature, which of
the following Is not within the implied authorised partners?
(a) That every partner may pledge or sell the partnership property
liability
(b) That any partner may admit any A in a suit against the firm
(c) That every partner may borrow money account of the partnership
(d) That every partner may engage servants for the partnership
business
Ans.B
56. If a person who is minor according to the the benefits of a
partnership, It is claimed
(a) his share in the firm’s property is not law to which he is subject is
admitted to that liable to the firm’s debts
(b) he can sue the partners to show the accounts
(c) he can enjoy, for some time, the status of minority even after
attaining majority
(d) he can sue the partners for payment of his share of profits of the
firm
Ans.C
57. Within how many months of attaining majority, a minor admitted
into the benefits a partnership firm must decide whether he wants to
become a partner in the firm?
(a) Two
b) Three
(c) Six
d) Twelve
Ans.C
58. When a minor elects to become a partner he becomes personally
liable to third parties for all acts of the firm done since
(a) he was admitted to be benefits of partnership.
(b) from the date of his attaining majority.
c) from the date of his becoming a partner.
(d) Both (b) and (e)
Ans.A
59. Under Section 25 of the Indian Partnership Act, 1932 the liability
of the partners for the acts of the firm is:
a) Joint and several
b) Several
c) Joint or several
d) joint
Ans.A
60. Implied authority of partner as agent of the firm under section 19
of the Partnership Act does not empower him to
(a) compromise or relinquish any claim by the firm.
(b) withdraw a suit filed on behalf of the firm.
(c) admit any liability in a suit against the firm.
(d) All these
Ans.D
61. Which of the following sections of the Indian Partnership Act
bestows every partner with the authority of an agent?
(a) Section 17
(b) Section 19
(c) Section 18
(d) Section 20
Ans.B
62. When a minor, who was admitted to the benefits of Partnership
becomes a partner upon attaining the age of majority, his personal
liability commences from:
(a) The date of his first admission to benefit of partnership
(b) The date of majority, if he continues in partnership
(c) The date fixed by all the partners
(d) Only his assets or contributions to the partnership is lisble
Ans.A
63. Out of the following which is not the correct statement regarding
‘retirement of a partner’?
(a) A partner may retire with the consent of all other partners
(b) A partner may retire in accordance with an express agreement by
the partners
(c) A partner may retire with dthe consent of any other partner
(d) Where the partnership is at will, a partner may retire, by giving
notice in writing to all the other partners of his intention to retire
Ans.C
64. A new person can be introduced into a firm as a partner under
Section 31 of the Act by
(a) Unanimous consent of all the partners
(b) Majority consent amongst the partner
(c) With the consent of the managing partner
(d) None of the above
Ans.A
65. In which of the following cases, a partner may cease to be a
partner without the dissolution of the firm?
(a) Retirement
b) Insolvency
(c) Death
d) All of these
Ans.D
66. Under the Indian Partnership Act, 1932, where the partnership is
at will, a partner way retire.
(a) by giving oral notice expressing his intention
(b) by giving written notice expressing his intention
(c) without any notice
(d) none of the above
Ans.B
67. Assess the truth or falsity of the following statements by picking
the right option under the Indian Partnership Act, 1932.
Statement I: Consent of all existing partners is generally required for
introduction of a new partner into a firm,
Statement II : A partner may retire with the consent of all other
partners in the firm.
(a) Only Statement I is true
(b) Only Statement II is true
(c) Only I and Il are true
(d) Both I and II are false
Ans.C
Q.68:- An act of a firm means:
a. Any partner or agent of the firm which gives rise to a right enforceable by or against the firm
b. Any act by all the partners
c. Any omission by all the partners
d. All of the above
Q.69:- Partnership is the relation between persons who have agreed to share the profits of a business
carried on by all or any of them acting for all. Does it mean that losses are not shared:
a. A minor may be admitted in partnership, only for the profits, but he cannot share in losses.
b. It also depends on the partnership agreement. A person may share the profits but may not share in losses.
c. Sharing of profits also include losses (negative profits)
d. All of the above.
Q.70- Where no provision is made by contract between the partners for the duration of their partnership,
or for the determination of their partnership, the partnership is called as:
a. Particular partnership
b. Partnership for a fixed term
c. partnership at will
d. None of the above
Q.71- What information shall be given to the Registrar of Firms by a registered partnership firm:
a. New opening/closing of the existing branch, if any.
b. Change in the name of and address of the partner (s)/change in the constitution of the firm.
c. What there is change in the name of the firm or in location of the principal place of business.
d. All of the above.
Q.72- Who can inspect the Register and filed documents at the office of the Registrar:
a. Any Government servant
b. The Partners of the firm
c. The partners of the other firms
d. Any person
Q.73:- What are the right of partners after dissolution:
a. To have the surplus distributed among the partners or their representatives according to their rights.
b. To have business wound up after dissolution
c. To have the property of the firm applied in payment of the debts and liabilities of the firm.
d. All of the above
Q.74:- Where any member of a firm has died or otherwise ceased to be a partner, and the surviving or
continuing partners carry on the business of the firm with the property of the firm without any final
settlement of accounts as between them and the outgoing partner or his estate, then, in the absence of a
contract to the contrary, the outgoing partner or his estate is entitled at the option of himself or his
representatives to such share of the profits made since he ceased to be a partner as may be attributable to
the use of his share of the property of the firm or to interest at the rate of on the amount of his share in
the property of the firm:
a. nine per cent, per annum
b. eighteen per cent, per annum
c. six per cent per annum
d. twelve per cent, per annum
Q.75:- The dissolution of partnership means:
a. It means the dissolution of partnership between all the partners of a firm
b. It means the change in the relations of the partners
c. It means the reconstitution of the firm.
d. None of the above.
Q.76:- In what circumstances a partner may retire:
a. In accordance with an express agreement by the partners
b. Where the partnership is at will, by giving notice in writing to all the other partners of his intention to
retire.
c. With the consent of all the other partners
d. All of the above.
Q.77:- What would be the position, where a minor elects not to become a partner:
a. He shall be entitled to sue the partners for his share of the property and profits.
b. His rights and liabilities shall continue to be those of a minor under this section up to the date on which he
gives public notice.
c. His share shall not be liable for any acts of the firm done after the date of the notice.
d. All of the above
Q.78:- After a partner’s death the business is continued in the old firm name. Whether the legal heirs of
the deceased partner are liable for any acts of the firm:
a. The continued use of the name or of the deceased partner’s name as a part thereof shall not of itself make
his legal representative or his estate liable for any act of the firm done after his death.
b. If the estate of the deceased person’s property is insufficient to make good, the personal assets of the legal
heirs will be liable for any of the acts done by the firm.
c. The estate of the deceased person is liable for any of the act done by the firm.
d. The legal heirs of the deceased partners shall be liable for any of the act done by the firm after the demise
of the partner
Q.79:- The partners in a firm may, by contract between the partners:
a. restrict the implied authority of any partner
b. extend the implied authority of any partner
c. None of the above
d. Both A and B are correct
Q.80:- Whether a notice given to a partner, who habitually acts in the business of the firm of any matter
relating to the affairs of the firm, will be deemed as notice to the firm:
a. It will deemed as personal information to that partner
b. Yes, it operates as notice to the firm, except in the case of a fraud on the firm committed by or with the
consent of that partner
c. It depends on the nature of the concerned partner whether he inform so to other partners
d. No, it will not deemed as notice to the firm.
Q.81:- What would be the position where a minor elects to become a partner.
a. His share in the property and profits of the firm shall be the share to which he was entitled as a minor
b. His rights and liabilities as a minor continue up to the date on which he becomes a partner
c. He also becomes personally liable to third parties for all acts of the firm done since he was admitted to the
benefits of partnership
d. All of the above
Q.82:- When there is any change in the constitution of the firm, what would be the statue of the
continuing guarantee given to the firm
a. It shall be revoked as to future transactions from the date of any change in the constitution of the firm.
b. Since it is the continuing guarantee, hence it be continuing.
c. Only the parties to the continuing guarantee can only decide over the matter.
d. None of the above.
Q.83:- Where a partner wilfully or persistently commits breach of agreements relating to the
management of the affairs of the firm or the conduct of its business, or otherwise so conducts himself in
matters relating to the business that it is not reasonably practicable for the other partners to carry on the
business in partnership with him. The other partner(s) may:
a. The partnership firm comes to an end automatically
b. The other partners may decide to leave the firm.
c. File a suit in the court for the dissolution of the firm.
d. The other partners may decide to expel the concerned partner
Q.84:- Who is not liable for the acts of the partners done after dissolution, if done before the dissolution,
until public notice is given of the dissolution
 a. A partner who, not having been known to the person dealing with the firm to be a partner, retires from the
firm (sleeping or dormant partner).
b. The estate of a partner who dies
c. Who is adjudicated an insolvent
d. All of the above
Q.85:- Where a partner has paid a premium on entering into partnership of a fixed term, and the firm is
dissolved before the expiration of that term otherwise than by the death of a partner, whether any
repayment of the premium is permissible:
a. He will not be entitled for repayment of the premium if the dissolution is mainly due to his own
misconduct
b. He will not be entitled for repayment of the premium if the dissolution is in pursuance of an agreement
containing no provision for the return of the premium or any part of it
c. He shall be entitled to repayment of the premium or of such part thereof as may be reasonable, regard
being had to the terms upon which he became a partner and to the length of time during which he wasa
partner
d. All of the above
Q.86:- Whether a partner after dissolution of the partnership firm, carry on the business in the erstwhile
business name of the firm
a. He can use the business name of the dissolved firm name, if he has brought the goodwill of the firm.
b. He can’t use the business name of the dissolved firm.
c. He can use the business name of the dissolved firm, provided there was a contract between the partners of
the dissolved firm
d. Both the points mentioned at A and C are correct
Q.87:- The State Government may appoint Registrars of Firms for the purposes of this Act, every
Registrar shall be deemed
a. To be a Central Government Servant.
b. To be a public servant within the meaning of section 21 of the Indian Penal Code
c. To be State Government Servant
d. To be a private servant
Q.88:- What is the penalty for submission of false particulars to the Registrar of Firms:
a. He shall be punishable with imprisonment v- which may extend to three months, or with fine, or with both
b. He shall be punishable with imprisonment which may extend to four months, or with fine, or with both.
c. He shall be punishable with imprisonment which may extend to two months, or with fine, or with both
d. He shall be punishable with imprisonment which may extend to one months, or with fine, or with both
Q.89:- What matters require notice to Registrar of Firms under section 63, and Public Notice by
publication in the Official Gazette and in at least one vernacular newspaper circulating in the district
where the firm to which it relate, has its place or principal place of business
a. The dissolution of a registered firm
b. The election to become or not to become a partner in a registered firm by a person attaining majority who
was admitted as a minor to the benefits of partnership
c. Retirement or expulsion of a partner from a registered firm
d. All of the above
Q.90:- What is the amount of fee which shall accompany with the documents sent to the Registrar of
Firms, or which shall be payable for the inspection of documents in the custody of the Registrar of Firms,
or for copies from the Register of Firms:
a. The fees prescribed by each of the State shall not exceed the maximum fees specified in Schedule I of the
Indian Partnership Act, 1932
b. The State Government may by notification in the Official Gazette make rules describing the schedule of
fees.
c. Both A and B are correct.
d. None of the above.
Q.91:- Non-registration of a firm will not affect:
a. The right of the partner to sue for the dissolution of the firm, or for the accounts of the dissolved firm, or
for share of the property of the dissolved firm.
b. All of the following
c. The right to any suit or claim of set-off not exceeding Rs. 100 in value
d. The right of a firm or partners of a firm having no place of business in India.
Q.92:- Where a partner has in any way transferred the whole of his interest in the firm to a third party,
or has allowed his share to be charged under the provisions of rule 49 of Order XXI of the First Schedule
to the Code of Civil Procedure, 190 or has allowed it to be sold in the recovery of arrears of land revenue
or of any dues recoverable as arrears of land revenue due by the partner.
a. The court may not dissolve the firm at the instance of any other partner(s).
b. The court may direct other partners to reconstitute the firm by excluding that concerned partner
c. The court may dissolve the firm at the instance of any other partner(s)
d. The court may expel the concerned partner, who has done wrong, from the partnership firm
Q.93:- How a firm may be dissolved
a. A firm may be dissolved by the Court order.
b. A firm may be dissolved by the Court order
c. A firm may be dissolved in accordance with a contract between the partners
d. All of the above.
Q.94:- On attaining the majority, the minor partner has to decide and give a public notice within the
prescribed period, whether he will continue as partner in the firm or will quit. What is that prescribed
period:
a. Within twelve months of his attaining majority or of his obtaining knowledge that he had been admitted to
the benefits of partnership, whichever date is later
b. Within three months of his attaining majority or of his obtaining knowledge that he had been admitted to
the benefits of partnership, whichever date is later
c. Within six months of his attaining majority or of his obtaining knowledge that he had been admitted to the
benefits of partnership, whichever date is later
d. Within nine month of his attaining majority or of his obtaining knowledge that he had been admitted to
the benefits of partnership, whichever date is later
Q.95:- In which conditions a person may be deemed as partner by estoppels or holding out:
a. When he by his conduct represents himself to be a partner in a firm
b. When knowingly permits himself to be represented, to be a partner in a firm.
c. When he expressly by words spoken or written let the others that he is a partner in a firm.
d. All of the above
Q.96:- M/s XYZ is partnership firm and X, Y and Z are the partners. During the course of business
travel, partner X recovered a sum of Rs. 15000 in cash from the debtor of the firm and credit in his
personal bank account. The act of X will amounts to:
a. After utilising the amount for few days, he returned back the money to the firm, so it will not come under
the mis-appropriation of the funds.
b. Nothing wrong in it, since he has personally made efforts in realising the dues from the debtor.
c. Mis-appropriating the funds of the firm and utilisation of the same for the personal gain.
d. None of the above.
Q.97:- What are the general duties of a partner:
a. To render true accounts and full information of all things affecting the firm to any partner or his legal
representative
b. To carry on the business of the firm to the greatest common advantage
c. To be just and faithful to each other
d. All of the above.
Q.98:- A consideration is must for every contract. Partnership is also an agreement enforceable at law,
hence it is also a contract to carry on the business for profit. Whether consideration, which is of essence
for the formation of a contract, is essential for the formation of the partnership
a. Partnership is an extension of the law of agency hence no consideration is required
b. Yes, consideration is must for the formation of the partnership.
c. There is no need to have consideration in formation of the partnership since no consideration is required
to create an agency.
d. Only A and C are correct.
Q.99:- After the dissolution of a firm the authority of each partner to bind the firm, and the other mutual
rights and obligations of the partners shall continue:
a. To complete transactions begun but unfinished at the time of the dissolution.
b. To wind up the affair of the firm
c. Both A and B are correct.
d. None of the above.

Q.100:- What shall be the treatment of goodwill in settling the accounts of a firm after dissolution:
a. The assessment of the amount of goodwill is a difficult task and cannot be precisely calculated, hence it
should not be considered
 b. The goodwill shall, subject to contract between the partners, be included in the assets, and it may be sold
either separately or along with other property of the firm.
c. The goodwill is an intangible assets and should not be accounted for.
d. None of the above.
Q.101:- How the settlements of debts will be made in case there are joint debts due from the firm, and
also separate debts due from any partner:
a. Debts of the firm shall be paid first out of the property of the firm, but in case of private debts of the
partners, is shall be paid in last(if there is residue) after paying of all the dues of the firm
b. Debts of the firm shall be paid first out of the property of the firm, but in case of private debts of the
partners, is shall be paid in last(if there is residue) after paying of all the dues of the firm.
c. Debts of the firm shall be paid first out of property of the firm and if there is any surplus, it shall be
distributed among the partners
d. Both A and C are correct.
Q.102:- Which is the implied authority of a partner:
a. To carry on the business of the firm, in the usual way.
b. Compromise or relinquish any claim or portion of a claim by the firm
c. Submit a dispute relating to the business of the firm to arbitration
d. Open a banking account on behalf of the firm in his own name
Q.103:- Subject to contract between the partners, the property of the firm includes:
a. Acquired, by purchase or otherwise, by or for the firm, or for the purposes and in the course of business of
the firm
b. The goodwill of the business.
c. All property and rights and interests in property originally brought into the stock of the firm
d. All of the above.
Q.104:- Where partnership deed is silent, which of the following statement is NOT correct:
a. The partners are entitled to share equally in the profits earned, and shall contribute equally to the losses
sustained by the firm.
b. A partner making, for the purposes of the business, any payment or advance beyond the amount of capital
he has agreed to subscribe, is entitled to interest thereon at the rate of 18% perannum.
c. A partner is not entitled to receive remuneration for taking part in the conduct of the business
d. Where a partner is entitled to interest on the capital subscribed by him such interest shall be payable only
out of profits
Q.105:- A transfer by a partner of his interest in the firm, either absolute or by mortgage, or by the
creation by him of a change on such interest, does entitle the transferee, during the continuance of the
firm
a. To require accounts of the firm
b. To inspect the books of the firm
c. Only to receive the share of profits of the transferring partner, and the transferee shall accept the account
of profits agreed to by the partners
d. To interfere in the conduct of the business of the firm
Q.106:- What is the liability of a retiring partner, after the date of his retirement'.
a. He shall not be liable for the act done by other partners during his tenurein the partnership firm.
b. He and the partners continue to be liable as partners to third parties for any act done by any of them which
would have been an act of the firm if done before the retirement, until public notice is given of the
retirement
c. He shall be liable for the acts done by him only on behalf of the firm during his tenure, towards the third
party.
d. Only A and B are correct.
Q.107:- An outgoing partner may carry on a business competing with that of the firm and hemay
advertise such business, but, subject to contract to the contrary, he may not:
a. Solicit the custom of persons who were dealing with the firm before he ceased to be a partner.
Agreements in restraint of trade.
b. Use the firm name
c. Represent himself as carrying on the business of the firm
d. All of the above
Q.108:- The dissolution of firm means:
a. It means the dissolution of partnership between all the partners of a firm.
b. It means the change in the relations of the partners.
c. It means the reconstitution of the firm.
d. Only B and C are correct.
Q.109:- What are certain contingencies when the firm has to be dissolved (subject to contract):
a. By the death of a partner and by the adjudication of a partner as an insolvent.
b. If constituted for a fixed term, by the expiry of that term
c. If constituted to carry out one or more adventures or undertakings, by the completion thereof
d. All of the above.