Fact Pattern 19-2 Maxine and Vince Verbally Agree to Form a Dog Grooming

question 28

Multiple Choice

Fact Pattern 19-2
Maxine and Vince verbally agree to form a dog grooming partnership called "XYZ Grooming." They file nothing with the state. Maxine puts up 80% of the capital needed for the partnership, and Vince supplies 20%. Maxine assumed that Vince would do extra work to account for the small amount of capital contributed by him, but that did not occur. Maxine found herself grooming more than 90% of the animals on her own. Maxine told Vince that he was only entitled to 10% of the profits because he was only doing 10% of the work. Vince disagreed, and a heated argument occurred. Not surprisingly, Maxine and Vince decided to end the partnership. While winding up affairs, Maxine discovered that Vince paid an excessive amount for some dog shampoo. She thought he bought it from a certain supplier just so he could flirt with the receptionist there. She told him that paying for the shampoo was entirely his responsibility because she had not agreed to the purchase. Maxine and Vince also became aware of a lawsuit filed by the owner of a Welsh Pembroke Corgi complaining that the dog developed a skin rash following bathing by Vince in the expensive shampoo he had purchased, and that the owner lost money because the dog could not be entered into shows. Maxine told Vince that the litigation was entirely his responsibility and that she disavowed any liability to the plaintiff.
-Refer to fact pattern 19-2. Which of the following is true regarding Vince's entitlement,if any,to share in profits of the business?

• A) Because he was not doing his share of the work, he was not entitled to any profits.
• B) He was entitled to 10% of the profits.
• C) He was entitled to 20% of the profits.
• D) He was entitled to 50% of the profits.

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Definitions:

NAD+

(Nicotinamide Adenine Dinucleotide) Coenzyme in oxidation-reduction reactions that accepts electrons and hydrogen ions to become NADH + H+ as oxidation of substrates occurs. During cellular respiration, NADH carries electrons to the electron transport chain in mitochondria.

Cellular Respiration

The metabolic process by which cells convert nutrients into energy (ATP), involving the oxidation of food molecules and the release of waste products.

Citric Acid Cycle

The Citric Acid Cycle, also known as the Krebs cycle, is a series of chemical reactions used by all aerobic organisms to release stored energy through the oxidation of acetyl-CoA derived from carbohydrates, fats, and proteins.

Cellular Respiration

Cellular respiration is a biochemical process in cells where organic molecules are broken down to release energy for use by the cell.