Asked by Miftahul Khaira on Apr 29, 2024
Verified
Mark is a partner in Harbin Associates,a partnership.The term of the partnership agreement is one year and does not include a clause on buyouts.After the term expires,Mark decides to dissociate while the remaining partners wish to continue.Under the RUPA:
A) the remaining partners must wind up and terminate the partnership.
B) they must buy out Mark of his interest on Mark's demand for the same.
C) they must not pay Mark the greater of the liquidation price or the sale price of the business.
D) they can renew their partnership agreement.
RUPA
The Revised Uniform Partnership Act, which is a set of laws designed to govern the operations of partnerships in the United States.
Buyout
The purchase of a company's shares to gain control over it, often by another company or a group of investors.
Liquidation Price
The value at which assets are sold off quickly, typically under conditions of financial distress.
- Learn the effects and legal consequences of partner dissociation on partnership agreements.
Verified Answer
AS
anushka saxenaMay 04, 2024
Final Answer :
B
Explanation :
When the dissociated partner has not wrongfully dissociated and there is no partnership agreement on the issue,the RUPA requires the partnership to pay the dissociated partner in cash within 120 days after he has demanded payment in writing.The buyout amount must include interest from the date of dissociation.
Learning Objectives
- Learn the effects and legal consequences of partner dissociation on partnership agreements.
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