Top 1000+ Solved Fundamentals of Laws and Ethics MCQ Questions Answer
Q. A partner can be expelled from a firm:
a. If power to expel is conferred by express agreement.
b. If the power is exercised in good faith.
c. By majority of partners after giving opportunity of explanation.
d. All of the above
Q. A retired partner may be liable:
a. For debts incurred before retirement.
b. For debts incurred after retirement until public notice is given.
c. Either (a) or (b)
d. Both (a) and (b)
Q. Unless there is a contract to the contrary, the effect insolvency of a partner is that:
a. The firm is dissolved
b. The firm is not automatically dissolved
c. The firm is also deemed insolvent
d. The firm is reconstituted
Q. No public notice is required:
a. On the death of a partner
b. On minor attaining majority
c. Retirement of partner
d. Dissolution of firm
Q. An outgoing partner can carry on a competing business and also advertise such business. For this purpose, in the absence of contract to the contrary —
a. He can use the firm's name
b. He cannot use the firm's name
c. He cannot represent himself as carrying on the business of the firm.
d. Both (b) and (c)
Q. As per section 38 when constitution of the firm is changed, the continuing guarantee given to the firm orto a third party in respect to the transactions of the firm:
a. Is not affected at all
b. Is revoked as to future transactions
c. Is revoked with retrospective effect
d. Ceases to be continuing guarantee
Q. Dissolution of partnership between all the partners of a firm is called:
a. Dissolution of partnership
b. Dissolution of partners
c. Dissolution of the firm
d. Reconstitution of firm
Q. If all partners, or all but one partner, of the firm are declared insolvent:
a. Firm is automatically dissolved
b. Firm becomes illegal association
c. Firm is also declared insolvent
d. Firm becomes illegal entity
Q. A firm is compulsorily dissolved on the:
a. Death of a partner
b. Adjudication of a partner as an insolvent
c. Expiry of a fixed period for which the firm was constituted
d. Business of the firm becoming illegal due to happening of an event
Q. If any event happens which makes it unlawful for the business of the firm to be carried on or for thepartners to carry it on it partnership, then
a. Firm is compulsorily dissolved
b. Partnership is reconstituted
c. Firm becomes an illegal association
d. Firm is declared insolvent
Q. A partnership may be dissolved by any partner by giving a notice to other partners in case of:
a. Partnership at will
b. Partnership for a fixed duration
c. Particular partnership
d. Limited liability partnership
Q. Which of the following do not constitute a ground- for dissolution by Court?
a. Misconduct by partner
b. Transfer of interest by partner
c. Just and equitable grounds
d. Insolvency of a partner
Q. Upon dissolution of firm, losses, including deficiencies of capital, shall be paid first:
a. Out of Profits
b. Out of Capital
c. By the partners in their profit sharing ratio
d. By the partners equally
Q. Upon dissolution of firm, losses, including deficiencies of Capital, shall be paid first out of Profits and thenout of Capital and finally —
a. Out of Profits
b. Out of Capital
c. By the partners individually in their profit sharing ratio
d. By the partners equally
Q. In settling the account after dissolution, the firm's assets shall be first applied in:
a. Payment of Debts of the firm to third parties
b. Payment of partner's Loan
c. Payment of partner's Capital
d. Distribution to partners in their Profit Sharing Ratio