Which of the following will establish the existence of a partnership?
A) A debt is repaid by the creditor taking a share of the profits.
B) An employee receives a profit-sharing bonus.
C) The good-will portion of the sale of a business is repaid by a share of the profits.
D) The parties intend to share the expenses of the business.
E) The beneficiary of a deceased partner takes that partner's share of the income from the partnership.

Question

Quizplus · Accepted Answer

The intention to share expenses of the business indicates a mutual agreement and joint control or management, which are key elements in establishing the existence of a partnership. Sharing profits alone, as in the other options, does not necessarily indicate a partnership without the intent to operate a business together.

Which of the Following Will Establish the Existence of a Partnership