Which of the Following Is True About Asset Distribution in an LLP

question 88

Multiple Choice

Which of the following is true about asset distribution in an LLP?

• A)If the LLP has been profitable,each partner will receive the net amount in his capital account.
• B)The partners have liability for partnership obligations beyond the firms' assets.
• C)An LLP partner has to contribute an amount equal to the negative balance in his account to pay creditors.
• D)The creditors must sue the partner to force the partner to pay the debt.

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Definitions:

Supplies Cost

The cost associated with materials and items used in the operation of a business but not directly tied to the products being manufactured or services provided.

Spending Variance

The difference between the actual amount of money spent and the budgeted or planned amount of expenditure.

Cost Formula

An equation used to predict the total cost of production, combining both fixed and variable costs, based on the level of activity or volume.

Indirect Materials

Small items of material such as glue and nails that may be an integral part of a finished product, but whose costs cannot be easily or conveniently traced to it.