Olav starts Power Cells to make and sell batteries. Later, Olav contracts with Quinn to invest additional capital in the firm in exchange for 25 percent of the profits. Olav and Quinn agree that Olav will continue to control the business. Olav and Quinn are not partners in Power Cells because
A) they do not share the profits equally.
B) their agreement does not provide for the sharing of losses.
C) Olav started the firm before Quinn agreed to invest additional capital.
D) they do not have joint control over the business.

Question

Quizplus · Accepted Answer

Olav and Quinn are not partners in Power Cells because they do not have joint control over the business. While Quinn has invested capital and has a share in the profits, the agreement states that Olav will continue to control the business. Therefore, Quinn is considered an investor rather than a partner in the company.

Olav Starts Power Cells to Make and Sell Batteries