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Introduction to Partnership

A third party...

Question

A third party with whom a partner has agreed to share the profit accruing to him from a partnership is known as _________.

A

Partner in profits

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B

Dormant partner

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C

Nominal partner

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D

Sub- partner

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Solution

The correct option is D Sub- partner
Sub-Partner - A Sub-Partner has no direct contact with the firm. He is only next to a partner.
When a partner agrees to share his share of profits in a partnership firm with an outsider, such an outsider is called sub-partner. Such sub-partner does not hold any rights against the firm nor liable for the debts of the firm, as he is in no way connected with the firm.

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Similar questions

Q. Consider the following statements :
1.Sharing profits is a conclusive evidence of a partnership.
2.A partner of a partnership firm is treated as an agent of the other partners.
3.A third party cannot file a suit against as unregistered firm or its partners.
Which of the above statement/s is/are true?

Q. When a partner of a firm agrees to share his own share of profits with an outsider, it called ________.

Q. Partnership deed provides that loss due to insolvency of a partner shall be shared by the remaining partners in the profit sharing ratio. There is a loss due to the insolvency of a partner. This will be shared by the remaining partner ___________.

Q. A partner who is entitled to share in the profits of a partnership firm without being liable to share the losses, is called a _______.

Q. A and B are two partners sharing profits in the ratio of

3 : 2

. They admit C into partnership as a partner. A gives 1/3rd of his share while B gives

1 / 10

th from his share. The new profit sharing ratio will be __________.

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