Practice | Compute and Allocate Partners’ Share of Income and Loss

Q1 | A well written partnership agreement should include each of the following except ________.

how to settle disputes

the name of the partnership

division of responsibilities

Partner’s individual tax rate

Q2 | What type of assets may a partner not contribute to a partnership?

accounts receivable

furniture

equipment

personal credit cards

Q3 | How does a newly formed partnership handle the contribution of previously depreciated assets?

continues the depreciation life as if the owner had not changed

starts over, using the contributed value as the new cost basis

shortens the useful life of the asset per the partnership agreement

does not depreciate the contributed asset

Principles of Accounting Volume 1: Financial Accounting