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easyMCQCUET Accountancy 2025 30 May Shift 12026Accountancy
1 mark

Which among the following is NOT true about a Partnership?

  1. A
    Each partner is liable jointly with all the other partners and also severally to the third party for all the acts of the firm done while he is a partner.
  2. B
    Partnership is the result of an agreement between two or more persons to do business and share their profits and losses.
  3. C
    If persons join hands for the purpose of some charitable activity it can be termed as partnership.
  4. D
    The minimum number of partners in a firm can be two.

Solution & Step-by-step Explanation

A primary element of a partnership is the running of a legal business with an ultimate motive to earn and share profits. A joint venture or activity for purely philanthropic or charitable purposes does not possess a commercial business motive and therefore cannot be legally classified as a partnership.

Practice this question

Try it yourself before checking the explanation above.

Which among the following is NOT true about a Partnership?
A
Each partner is liable jointly with all the other partners and also severally to the third party for all the acts of the firm done while he is a partner.
B
Partnership is the result of an agreement between two or more persons to do business and share their profits and losses.
C
If persons join hands for the purpose of some charitable activity it can be termed as partnership.
D
The minimum number of partners in a firm can be two.

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