Transcribed Image Text
In: AccountingQuestion 2: PartnershipsIn 2008, Dan Baxter and Philip Jones set up a partnership totrade...Question 2: PartnershipsIn 2008, Dan Baxter and Philip Jones set up a partnership totrade as organic greengrocers under the name Baxter and Co. Theyfrequently purchase organic produce from Yvonne Botica, an elderlyfarmer. Orders are usually made on the firmâs letterhead, which hasthe words â D Baxter and P Jones, trading as Baxter & Coâprinted in small type at the bottom.On 31 August 2017, Philip retires from the partnership andceases working in the business. Philipâs name is removed from theletterhead but no other notice is given to customers or the publicabout Philipâs retirement. In October 2017, Dan orders and receives$10,000 worth of goods from Yvonne. However, before the bill ispaid Dan becomes insolvent. Yvonne decides to sue Philip as Danâspartner.Answer the following questions. Refer to relevant provisions(including subsections) in the Partnerships Act 1908 to supportyour answers. (a) Is Philip liable to Yvonne for the debt incurredby Dan? In addition to relevant legislation, refer to a case tosupport your answer.(b) What steps should Philip have taken when he retired toensure he would not be liable for post-retirement partnershipdebts?(c) Whether Philip could be liable for holding out toYvonne.