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Under Section 16(b), if a partner carries on a business of the same nature as and competing with the firm, he must:
APay a fixed penalty
BAccount for and pay to the firm all profits made in that competing business
CDo nothing if no agreement bars it
DDissolve the firm
Answer & Solution
Correct answer: B. Account for and pay to the firm all profits made in that competing business
Section 16(b) makes a partner accountable to the firm for all profits of a competing business of the same nature, subject to a contrary contract.
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