1. Which are the matters that require unanimous consent of all the partners:
Correct : D. All the above
2. A partner has an implied authority to bind a firm by his act if he:
Correct : D. None of the above
3. The liability of a minor partner is limited to the extent of:
Correct : A. His share in the firm
4. A minor who is admitted to the benefit of partnership:
Correct : D. All the above
5. Subject to contract between the partners, a partner does not have any one of the following rights:
Correct : A. Right to receive remuneration
6. The authority of a partner to bind the firm for his acts as contained in section 19 of the Partnership Act is
known as:
Correct : C. Implied authority
7. An act done by a partner is binding on the firm if it is done in the name of:
Correct : C. Firm
8. A partner can bind a firm by his act if he:
Correct : D. Buys goods on behalf of the firm
9. For ordinary business matters the decisions in the firm are taken on the basis of :
Correct : A. Decision of majority of partners
10. Which of the following statements is incorrect?
Correct : D. All the above
11. When a minor is admitted to the benefit of the partnership, which of the following statements is false:
Correct : B. The minor is also personally liable
12. The partners take decisions on the basis of majority in:
Correct : B. Ordinary matters
13. An unregistered partnership:
Correct : A. Can sue on matters arising otherwise than out of contract
14. Every partner has a right to have access to and inspect and copy any of the books of account of the firm.
Correct : D. All the above
15. Where a partner is entitled to interest on the capital subscribed such interest shall be payable.
Correct : A. Only out of profits
16. Subject to contract between the partners, and pursuant to section 13 of the Indian partnership, the
following statement is correct:
Correct : C. Partner is not entitled to remuneration for taking part in the conduct of the business
17. Any dispute arising as to ordinary matters connected with the business may be decided by-
Correct : B. Consent of majority partners
18. A change in nature of business can be effected only based on —
Correct : A. Unanimous consent of all the partners
19. Property of the firm does not include:
Correct : D. Property belonging to the partners
20. Where a firm constituted for a fixed term continues to carry on business after the expiry of the said term,
the mutual rights and duties of the partners will —
Correct : C. Be similar as that of partnership at Will
21. Which of this falls outside the implied authority?
Correct : C. Submit disputes for arbitration
22. Which of these acts are within the implied authority?
Correct : D. To issue cheques on behalf of the firm
23. The implied authority of any partner is subject to:
Correct : C. Both (a) and (b)
24. Notice to a partner operates as notice to the firm. For such purpose, notice may be given to:
Correct : B. A partner who habitually acts in the business of the firm
25. A minor may give public notice of his decision to continue or withdraw from the firm on his attaining majority within:
Correct : B. Six months
26. On attaining majority when the minor partner elects not to become a partner, his share is not liable for any acts of the firm done —
Correct : B. After the date of giving public notice
27. A minor, before attaining the age of majority, has the right to:
Correct : D. All of the above
28. When a minor on attaining the age of majority, has elected to become a partner, he becomes personally liable to third parties for all the acts of the firm from the date of his:
Correct : C. Admission to the benefits of the firm
29. 'Act of a firm' in the Partnership Act means:
Correct : B. Any such act or omission which give rise to a right enforceable by or against the firm
30. According to section 31 of the Act, subject to the contract between the partners and to the provisions of section 30, no person shall be introduced as a partner into a firm:
Correct : B. Without the consent of all the existing partners
31. If a partner is adjudicated insolvent which of the following are the consequences?
Correct : D. All the above
32. A partner may not be expelled from the firm by any majority of partners unless:
Correct : D. All the above
33. Unless there is a contract to the contrary, a firm is automatically dissolved on:
Correct : D. All of the above
34. Under Section 36 of this Act an outgoing partner may carry on business competing with that of the firm and he may advertise such business, but, subject to contract to the contrary he may not
Correct : D. All of the above
35. Agreement in restraint of trade is void. But if an outgoing partner agrees with the firm that he will not carry
on any competing business, such an agreement will be valid if:
Correct : A. Such restraint is in respect of carrying of any business similar to that of the firm
36. A notice in writing by one partner must be given to all the partners of the firm in case of:
Correct : B. Dissolution of partnership at will
37. The following is a ground for dissolution of partnership by the Court:
Correct : D. All the above
38. In settling the account of the firm after dissolution, the assets of a firm are to be applied in paying
Correct : D. All of the above
39. The partners authority to act for the firm and to bind their co-partners continues even after the dissolution
of the firm:
Correct : C. Both of above
40. A public notice under the Partnership Act is given according to section 72 in the following cases:
Correct : D. All the above
41. Which of the following is not a mode of retirement of partner?
Correct : D. Retirement on attaining the age of superannuation
42. In case of partnership at will, a retiring partner has to give a written notice —
Correct : A. To all the partners
43. Retiring partner continues to remain liable to third parties for acts of the firm :—
Correct : A. Until public notice is given of the retirement.
44. To avoid liability to third parties, public notice of retirement should be given. Such public notice must be given—
Correct : C. Either (a) or (b)
45. A partner can be expelled from a firm:
Correct : D. All of the above
46. A retired partner may be liable:
Correct : D. Both (a) and (b)
47. Unless there is a contract to the contrary, the effect insolvency of a partner is that:
Correct : A. The firm is dissolved
48. No public notice is required:
Correct : A. On the death of a partner
49. 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 —
Correct : D. Both (b) and (c)
50. As per section 38 when constitution of the firm is changed, the continuing guarantee given to the firm or
to a third party in respect to the transactions of the firm:
Correct : A. Is not affected at all
51. Dissolution of partnership between all the partners of a firm is called:
Correct : C. Dissolution of the firm
52. If all partners, or all but one partner, of the firm are declared insolvent:
Correct : A. Firm is automatically dissolved
53. A firm is compulsorily dissolved on the:
Correct : D. Business of the firm becoming illegal due to happening of an event
54. If any event happens which makes it unlawful for the business of the firm to be carried on or for the
partners to carry it on it partnership, then
Correct : A. Firm is compulsorily dissolved
55. A partnership may be dissolved by any partner by giving a notice to other partners in case of:
Correct : A. Partnership at will
56. Which of the following do not constitute a ground- for dissolution by Court?
Correct : B. Transfer of interest by partner
57. Upon dissolution of firm, losses, including deficiencies of capital, shall be paid first:
Correct : A. Out of Profits
58. Upon dissolution of firm, losses, including deficiencies of Capital, shall be paid first out of Profits and then
out of Capital and finally —
Correct : C. By the partners individually in their profit sharing ratio
59. In settling the account after dissolution, the firm's assets shall be first applied in:
Correct : A. Payment of Debts of the firm to third parties
60. Upon dissolution, the firm's assets after settlement of the debts of the firm to third parties and partners' Loans, shall then be applied in —
Correct : C. Payment of partner's capital
61. Where a partnership contract is rescinded on grounds of fraud or misrepresentation, the party entitled to
rescind, is also entitled to rank, in respect of any payment made by him for the firm's debts as a:
Correct : A. Creditor
62. After a firm is dissolved, every partner or his representative may restrain any other partner or his representative from carrying on similar business in the firm's name or by using firm's property for own benefit, until:
Correct : A. The affairs of the firm are completely wound up
63. When goodwill of the firm is sold upon dissolution, and a partner carries on a competing business, which
of the following is permissible?
Correct : D. None of the above
64. Public notice in case of a firm is not required in case of:
Correct : A. Admission of a partner
65. Public notice is required to be given in the case
Correct : B. exercising option to continue or not, on attainment of majority by the minor
66. When goodwill of the firm, the selling partners may agree with the buyer that they will not carry on similar business, within a specified period or within specified local limits. Such agreement in restraint of trade shall be :
Correct : A. Valid, if the restrictions imposed are reasonable
67. Public Notice under the Partnership Act, is given in the following manner:
Correct : D. All of the above
68. Identify the incorrect statements: (1) When a firm is constituted for a fixed duration it cannot be dissolved before the expiry of that duration. (2) A partnership at will can be dissolved by the wish of even a single partner. (3) When a partner of a firm becomes lunatic, the firm dissolves automatically. (4) Even after dissolution, partners of a firm continue to be liable for acts of the firm until the affairs of the firm are finally wound up. Code:
Correct : B. 1,3 and 4
69. A, B and C are partners of an unregistered firm. D owns this firm ` 1000 on a contract. The firm filed a suit
against D the suit is dismissed for non-registration of the firm. The firm is registered later on. In this case which one of the following statements is MOST appropriate.
Correct : A. The firm can successfully bring the suit against D
70. X, Y and Z are partners in a firm. X, without the authority of Y and Z buys certain shares in his name out of
partnership money. Will 'shares' constitute partnership property?
Correct : A. Yes
71. A, B and C are partners. C is a sleeping partner who is not known to the creditors. C retires without giving
public notice of his retirement. Is C liable for subsequent debts incurred by A and B.
Correct : A. No, since he is a sleeping partner
72. The Negotiable Instruments Act, 1881 applies to
Correct : A. the whole of India
73. The Negotiable Instruments Act, 1881 came into force on
Correct : C. 1st March, 1882
74. The undertaking contained in a promissory note, to pay a certain sum of money is
Correct : B. Unconditional
75. A bill of exchange contains a/an
Correct : B. unconditional order
76. Cheque is a
Correct : B. bill of exchange
77. The term 'Negotiable instrument' is defined in the Negotiable Instruments Act, 1881, under section
Correct : B. 13
78. If an instrument may be construed either as a promissory note or bill of exchange, it is
Correct : B. an ambiguous instrument
79. Under section 16 of the Negotiable Instrument Act, 'endorsement in blank' of an instrument means
Correct : B. where the endorser signs his name only on the instrument
80. 'At sight' and ‗on presentation‘ under section 21 of the Negotiable Instrument Act, 1881, means
Correct : B. on demand
81. If a minor draws, endorses, delivers or negotiates an instrument, such instrument binds
Correct : C. all parties to the instrument except the minor
82. In a promissory note, the amount of money payable
Correct : A. must be certain
83. Liability of drawer to compensate the holder in case of dishonour is primarily provided under
Correct : A. Sec 30
84. Issuance of notice by the holder in case of dishonour is primarily provided in …………
Correct : A. Sec.93
85. A cheque is crossed ………… when it bears across its face an addition of the name of a banker, either
with or without the words "not negotiable".
Correct : A. Specially
86. A note under section 99 of the Negotiable Instruments Act should contain among other things
Correct : B. charges of notary
87. A notice of protest under section 102 of the Negotiable Instruments Act, 1881
Correct : A. may be given by the notary public who makes the protest
88. Under section 118 of the Negotiable Instruments Act, 1881, it is presumed, until the contrary is proved, that
every transfer of a negotiable instrument was made
Correct : B. before its maturity
89. The provisions of section 87 of the Negotiable Instruments Act, 1881, are subject to the provisions of
Correct : C. sections 20, 49, 86 and 125 of the Act
90. Under section 97, of the Negotiable Instruments Act when the party to whom notice of dishonour is
dispatched is dead, but the party despatching the notice is ignorant of his death, the notice is
Correct : A. Sufficient
91. Who among the following cannot cross a cheque?
Correct : D. Foreigner
92. As per section 147 of the Negotiable Instruments Act, 1881, every offence punishable under the Act are
Correct : A. Compoundable
93. Under the provisions of section 143 of the Negotiable Instruments Act, 1881, all offences under the Act are
to be tried by
Correct : B. Judicial Magistrate of the First Class or by a Metropolitan Magistrate
94. For what term of imprisonment an offender under section 138 of the Negotiable Instruments Act can be
punished?
Correct : A. for a term which may extend to two years
95. The presumption as to the date of a negotiable instrument under section 118 is that, every negotiable
instrument bearing a date was made or drawn
Correct : B. on such date
96. Chapter XVII contain sections
Correct : A. 138 to 142
97. Who should make a complaint to a court for the purpose of taking cognizance of an offence under
section 138?
Correct : A. the payer or as the case may be, the holder in due course of the cheque
98. A complaint against an offence under section 138 of the Negotiable Instrument Act, 1881
Correct : A. must be in writing (section 142)
99. Under section 143 of the Negotiable Instruments Act, an endeavour shall be made to conclude the trial
within.......................... months from the date of filing of the complaint
Correct : C. 6
100. The provision of section 147 of the Negotiable Instruments Act, 1881, that every offence punishable under
this Act shall be compoundable was inserted by the