Which of the following statements is true regarding joint ventures?
A) Participants in a joint venture usually share profits equally, but share losses based on the percentage of contribution.
B) Participants in a joint venture usually share losses equally, but share profits based on the percentage of contribution.
C) The joint venture is not automatically terminated when one of the members dies.
D) A joint venture requires the filing of a formal agreement with the state.
E) Courts frequently apply sole proprietorship law to joint ventures.

Question

Quizplus · Accepted Answer

Joint ventures do not automatically terminate upon the death of a participant. Instead, the continuation or termination of the joint venture upon such an event depends on the terms set out in the joint venture agreement. This flexibility is one of the characteristics that distinguish joint ventures from partnerships, where the death of a partner can lead to automatic dissolution unless otherwise agreed.

Which of the Following Statements Is True Regarding Joint Ventures