Question #: 1700 Category: 2F2 Formation, Operation, and Termination

  • Creator
    Topic
  • #1344927
    benboccio
    Participant

    In a general partnership, the authorization of all partners is required for an individual partner to bind the partnership in a business transaction to:

    A.
    purchase inventory.
    B.
    hire employees.
    C.
    sell goodwill.
    D.
    sign advertising contracts.

    Purchasing inventory, hiring employees, and signing advertising contracts are normal activities of a business and do not require the participation of all of the partners. The sale of goodwill is an extraordinary matter that would require the approval of all of the partners.

    This is a weird one. How does a partnership sell goodwill?

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