A firm has two partners: Jim and Bill. Jim owns 60% of the partnership and Bill owns 40%. In which of the following transactions will the partnership be responsible for the partners' actions?
A)Jim signing the contract as a guarantor for Bill's personal loan
B)Jim buying a laptop on credit for personal use
C)Bill signing a contract to buy furniture for official use in the partnership
D)Bill defaulting on payment of his credit card bill

Question

Quizplus · Accepted Answer

Bill signing a contract to buy furniture for official use in the partnership is a partnership transaction and hence the partnership will be responsible for Bill's actions. The other options are either personal transactions or individual liabilities and do not involve the partnership.

A Firm Has Two Partners: Jim and Bill