8 Questions
What is the main characteristic of a limited partnership?
Partners are liable only up to the extent of their capital contributions
Which of the following increases the capital account in partnership activities?
Initial investment
In accounting for partnership activities, how are loan accounts between partners and the partnership reported?
As separate balance sheet items
What is a key feature of general partnership with regard to partner liability?
Each partner is personally liable to the partnership’s creditors
How is local currency valued in the context of cash investment in partnership formation?
At face value
What approach is used if the partners' initial investments are not equal to their agreed capital?
Bonus approach
How are noncash investments recorded in partnership formation?
At fair value
How are liabilities assumed by the partnership valued?
At fair value
Learn about the formation of partnerships governed by the Partnership Law under the Philippine Civil Code. Explore the characteristics and types of partnerships, including ease of formation, limited life, mutual agency, separate legal entity, and more.
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