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When a general business partnership fails, the partners: Select one: A. are liable for losses equivalent to their own individual contributions. B. lose only their investment. C. may be required to pay partnership debts from personal assets. D. can waive their limited liability.

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User Tconbeer
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1 Answer

5 votes

Answer:

The correct answer is letter "C": may be required to pay partnership debts from personal assets.

Step-by-step explanation:

A partnership is an association in which two or more owners operate a company. They divide the profits in proportion to their partnership benefit in percentage terms. Two types of partnerships exist: general partnerships and limited partnerships.

General partners normally share managing duties, profits and losses equally regardless of their partnership interest percentage. At the end of the day, however, each partner has unlimited liability in a general partnership. This last implies the partners' personal assets are considered for repayment in front of debt of the partnership.

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User Megastep
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