Under the UPA,dissolution by Operation of Law Occurs

question 61

Multiple Choice

Under the UPA,dissolution by operation of law occurs:

• A) if a partner has been adjudicated mentally incompetent.
• B) upon the bankruptcy of a partner.
• C) when a partner has engaged in conduct prejudicial to the business.
• D) when the business can be carried on only at a loss.

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Definitions:

Profit and Loss Ratio

Typically refers to the profit margin, which measures the efficiency of a company in generating profits from its operations, calculated as net income divided by revenue.

Closing Entry

Journal entries made at the end of an accounting period to transfer the balances of temporary accounts to permanent accounts, preparing the books for the next period.

Capital Balances

The amounts of money that the owners of a company have contributed to it or have accumulated over time.

Unlimited Liability

A legal structure in business where the owners are personally responsible for all the debts and liabilities of the business.