Question

Question 33 5 pts Greg, Dan, and Nancy orally agreed to open a gym called So Cal Fitness. They operate as a general partnership but have not documented their agreement in a writing. Answer the following questions: 1. If the partnership needs a new copier, how many partners must agree? (1 point) 2. Will Greg, Dan, and Nancy be compensated for their involvement in So Cal Fitness? (1 point) 3. If Greg suggests that Walter become a partner, how many partners must agree? (1 point) 4. Identify two (2) ways one of the partners may disassociate him/herself from the partnership. (2 points)

Answer 1

Assumption: In Absence of Specific Information, Solution is given as per Provisions of Revised Uniforms Partnership Act. (RUPA) part of US legislation.

Answer:

1.

Partner's consent is not required for Purchase of Asset used under normal course of Partnership Business.

In Given Case, in Absence of Written agreement Partner's consent is not required for Purchase of New Copier for normal course of Partnership Business.

So, based on above Explanation NO Partner's consent is required for Purchase of New Copier for normal course of Partnership Business.

2.

Generally in Absence of Specific Agreement Partners are entitled for Share of Profit or Loss from Partnership. Partners are not entitled for compensation for their Investment in form of Interest on Capital Contributed or any other method unless Agreed in writing by all the Partners.

So, In given case Greg, Dan & Nancy will NOT be compensated for their Investment in So Cal Fitness as there is no specific agreement between them regarding compensation for their Investment.

3.

Generally, All Partners must be agreed in case of admission of New Partner in the Partnership.

So, In above case ALL three Partners which are Greg, Dan, Nancy must be AGREED for admission of Walter as New Partner in So Cal Fitness.

4.

The following are ways by which one of the Partners may dissociate himself / herself from the Partnership.

A. By Giving Notice to remaining Partners regarding Dissociation from Partnership.

B. By Virtue of his/her Death.

C. By Virtue of his/her Bankruptcy.

D. By Virtue of his/her Permanent incapacity.