A Partnership Agreement Defines How the Partners Will Be Compensated

question 19

Multiple Choice

A partnership agreement defines how the partners will be compensated. Normally, ________.

• A)partners are not entitled to salaries or wages, but are compensated by a share of the profits of the business
• B)the general partner's salary is set at two times the salaries of the limited partners
• C)both general and limited partners are permitted salaries, but all silent or dormant partners are compensated only by sharing in the profits
• D)while the agreement establishes payout schedules, it does not spell out what constitutes profit

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Definitions:

Improve Quality

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