James Fine is doing business as Fine's Apparels, a sole proprietorship. In the past year Fine had regularly joined with Charles Walters in the marketing of bathing suits and beach accessories. Which of the following factors is the most important in ascertaining whether Fine and Walters have created a partnership relationship?
A. A partnership agreement is not in existence.
B. Each has a separate business of his own that he operates independently.
C. Fine and Walters divide the net profits equally on a quarterly basis.
D. Fine and Walters did not intend to be partners.
Answer: C. Fine and Walters divide the net profits equally on a quarterly basis.
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