Question

Provides that, in general, no gain or loss is recognized by the partnership or the partner on contribution of appreciated or depreciated property to a partnership in exchange for an interest in the partnership.

a) True
b) False

Answer 1

The statement is false; proprietors in a proprietary colony had multiple responsibilities including governance, defense, and overseeing trade, not just collecting profits.

Step-by-step explanation:

The statement that in a proprietary colony, the Proprietors have no responsibilities except to collect the profits is false. Proprietary colonies were granted by the English Crown to one or several proprietors who had full governing rights. While they did collect profits from the colony, proprietors also had many responsibilities, such as establishing a government, maintaining order, providing for defense, and overseeing trade and settlement. They could establish courts, enact laws, and take necessary actions to ensure the success and stability of the colony.