Which of the Following Statements About a Partnership Is Correct

question 42

Multiple Choice

Which of the following statements about a partnership is correct?

• A) The personal assets of a partner are included in the partnership accounting records.
• B) A partnership is required to file an income tax return.
• C) Each partner's share of profit is taxable to the partnership.
• D) A partnership represents an accounting entity for financial reporting purposes.

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Definitions:

Mixed Cost

Expenses that have both fixed and variable components, changing in total with the level of activity but also containing a constant element.

Least-squares Regression

A statistical technique that identifies the most accurate line of fit by reducing the total of the squared differences between the actual and forecasted values.

Mixed Cost

Expenses that contain both fixed and variable components, changing with the level of output or activity.

High-low Method

A technique used in managerial accounting to estimate variable and fixed cost components of a cost formula, using the highest and lowest levels of activity.