In the absence of a partnership deed, what is the rule regarding salaries to partners? MCQ with Answer and Explanation

In the absence of a partnership deed, what is the rule regarding salaries to partners?
A. No partner is entitled to a salary
B. Salary proportional to capital
C. Equal salary to all partners
D. Salary based on hours worked
Answer: Option A
Solution (By JKSSB Mock Tests)
Section 13(a) of the Indian Partnership Act, 1932 states that partners are not entitled to receive any remuneration for participating in the business.

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Practice More Accountancy and Book Keeping Questions

Question #1
An audit that is conducted between two annual audits is called:
A. Continuous audit
B. Statutory audit
C. Final audit
D. Interim audit

Correct Answer: Option D


Explanation:
Interim audit is performed in between the year, often for dividend declaration or half-yearly results.

Question #2
The 'Financial Management' decision relating to the mix of debt and equity is called:
A. Dividend decision
B. Investment decision
C. Liquidity decision
D. Financing decision

Correct Answer: Option D


Explanation:
Financing decision concerns how to raise funds, i.e., capital structure.

Question #3
The maximum number of partners allowed in a partnership firm (as per Companies Act, 2013) is:
A. 20
B. 50
C. 10
D. 100

Correct Answer: Option B


Explanation:
As per Section 464 of Companies Act 2013, maximum number of partners can be 50, unless otherwise prescribed. The earlier limit of 20 for non-banking and 10 for banking has been raised to 50 for all firms.