Which of the following is true of profits and losses in a general partnership?

Question

Quizplus · Accepted Answer

In a general partnership, unless otherwise agreed upon, losses are shared equally by all general partners. The proportion of investment governs both the proportion of profits obtained and the proportion of losses shared. Option A is incorrect because the proportion of profits shared is determined by the partnership agreement, not the initial investment. Option C is incorrect because profit-sharing is based on the partnership agreement, not who proposed the business idea. Option D is incorrect; the proportion of investment governs both profits obtained and the proportion of losses shared.

Which of the Following Is True of Profits and Losses