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57. Lita and Linda are partners in a general partnership and have borrowed $10,000 from the bank to finance their start-up. How is their liability for the bank loan best characterized? a. limited liability b. joint liability c. proportional limited liability d. full and complete impunity 58. Which statement best describes how a partnership comes into existence? a. The partners must sign a written partnership agreement. b. The partners must register the partnership. c. Two or more people carry on business together with a view to profit. d. Two or more people purchase property together. 59. Ray and Mohammed are forming a general partnership but have not yet discussed how profits will be shared between them. Which statement best describes their legal situation? a. General partners are always required to share profits equally. b. They are automatically entitled to a share proportional their relative contributions to the capital of the partnership. c. They cannot have a partnership until they determined how profits will be shared. d. If they fail to agree, partnership legislation requires them to share profits equally.

67. The Partnership Act provides for the following rule: all partners are to share equally in the capital and profits of the business and must contribute equally to the losses. Which statement best exemplifies this rule? a. The losses are restricted to the capital investments made by each partner. b. This rule is optional and may be varied by written agreement. c. This rule is mandatory and cannot be modified by agreement. d. The rule applies only to limited liability partnerships. 68. What is a positive feature of carrying on business as a limited partnership? a. All partners are completely shielded from negligent or wrongful acts of partners. b. They can be used as an investment device. c. They can be created informally. d. All partners have the same rights

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