Identify Which of the Following Statements Is True

question 11

Multiple Choice

Identify which of the following statements is true.

• A) Formation of a partnership requires legal documentation.
• B) A partnership exists as long as there are at least two individuals or entities engaged in the active conduct of a trade or business or a financial operation, and the business is not a trust or a corporation.
• C) An individual engaged in the active conduct of a business must elect not to be taxed as a partnership.
• D) All of the above are false.

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Definitions:

Valid Offer

A proposal by one party to another intending to create a legally binding agreement, subject to acceptance by the party to whom it is made.

Authorized Means

Officially approved or recognized methods or procedures for achieving a specified end.

Acceptance

In contract law, the agreement by the party receiving an offer to the terms of that offer, leading to a binding contract.

Contract

A legally binding agreement between two or more parties that outlines obligations they must fulfill.