Get Started
Start Free Mocks
CUETMOCK

Ace Your

CUET Preparation Today

Start Free Mocks
Home Questions SQWP82SZD2
Target Exam

CUET

Subject

-- Accountancy Part A

Chapter

Accounting for Partnership

Question:

Which among the following is NOT true?

Options:

Valid partnership can be formulated even without a written agreement between the partners.

Each partner carrying on the business is the principal as well as the agent for all the other partners.

Mere co-ownership of a property can amount to partnership.

Persons who have entered into partnership with one another are individually called 'partners' and collectively called 'firm'.

Correct Answer:

Mere co-ownership of a property can amount to partnership.

Explanation:

The correct answer is Option (3) → Mere co-ownership of a property can amount to partnership.

Statement Status Rationale
Valid partnership can be formulated even without a written agreement between the partners. TRUE A partnership is created by an agreement, which can be oral or implied by conduct. A written agreement (Partnership Deed) is highly recommended but not legally mandatory for validity.
Each partner carrying on the business is the principal as well as the agent for all the other partners. TRUE This is the core concept of Mutual Agency, which is a defining test of a partnership.
Mere co-ownership of a property can amount to partnership. NOT TRUE Co-ownership of property (e.g., inheriting a building together) does not automatically constitute a partnership. A partnership requires an agreement to carry on a business with the intent of sharing profits.
Persons who have entered into partnership with one another are individually called 'partners' and collectively called 'firm'. TRUE This is the standard legal and conceptual definition of the relationship and the business entity.

 

CUET Questions