Final answer:
Ali and Sol drafted an Articles of Co-Partnership when forming their partnership, outlining the terms of their business agreement as well as each partner's rights and duties.
Step-by-step explanation:
When Ali and Sol formed a partnership and began listing the essential terms of their agreement, specifying their rights and duties, they were drafting a Articles of Co-Partnership. This document typically sets out how the partnership will be managed, the distribution of profits and losses, the responsibilities of each partner, and what happens if the partnership is dissolved. Partnerships are one of the three most common forms of business organizations, with the others being sole proprietorships and corporations. Each structure has its benefits, with partnerships offering ease of start-up, management flexibility, and no special taxes.
It's important to note that in a partnership, partners share profits and responsibility for the business's actions, including debts and liabilities. While it is somewhat more efficient than a sole proprietorship and can easily attract investors, partners must be aware of their mutual responsibilities and the potential for the partnership to change or dissolve should one partner leave or pass away.