Which of the Following Is True Under the Uniform Partnership

question 65

Multiple Choice

Which of the following is true under the Uniform Partnership Act,regarding profit and partnerships?

• A) There is no requirement that a partnership be formed with a profit-making motive, and all states recognize the status of non-profit partnerships.
• B) A partnership must have a profit-making motive only if the partnership has five or more members.
• C) There is a requirement that a partnership have a profit-making motive only if the partnership has been in existence for over one year.
• D) The partners must operate the business for a profit, and the partnership must be dissolved if no profit is made for three consecutive years.
• E) The partners must operate the business for a profit which is construed to mean that the partners must intend to make some kind of profit from the business.

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Definitions:

Investment

Allocation of resources, usually money, in expectation of a future return or profit.

Interest

The cost of borrowing money or the return on investment, typically expressed as a percentage.

Interest Rate

The percentage at which interest is paid by a borrower for the use of money, or what a lender earns on an investment, over a specific period.

Loan

A sum of money that is lent and is due to be repaid along with interest.