Please read our disclaimer. Answer to Question 10 10. You and a group of friends form a band, and manage to make some extra money playing at parties and local clubs. Answer - B. We are partners in a general partnership. When the band members got together and decided to play music for money, the members started a business.
Every business falls into one of several categories.
If you don't select a category for your business, the law will place you in one. Since your business consists of 2 or more people, the law views it as a general partnership. Forming a partnership requires no formal action on the part of the band members other than joining together in a business activity with the intention of making money. While partners can have a written agreement, one is not required for a partnership to exist.