Question

6. Which of the following is not an essential element of partnership?
(A) Association of two or more persons
(B) Mutual agency
(C) Result of an agreement
(D) Separate legal entity​

Answer 1

Answer:

Separate legal entity

Answer 2

The correct answer to this question is option (D) Separate legal entity.

Explanation:

• A partnership needs to have two or more persons in order to form a partnership firm.

• A partnership firm is all about a mutual agreement between several people to carry out a business together.

• An agreement is a necessity for any kind of partnership since it outlines all the terms and conditions to be operated.  

• A mutual agency test must be there so that the compatibility of each partner can be checked for potential benefits.

• A separate legal entity is not conceivable with a partnership firm because the business and the owner are the same in this case.