Which one of these characteristics best describes the primary advantage of being a limited partner rather...
Which one of these characteristics best describes the primary advantage of being a limited partner rather than a general partner?
Multiple Choice
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Personal financial liability limited to the capital invested
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Entitlement to a larger portion of the partnership's income
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Profits free of any income taxation
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Day-to-day management control of the business
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Overall control of the partnership
Homework Answers
Personal financial liability limited to the capital invested
A limited partner as the name suggests has limited financial liability. The liability is limited to the amount invested in the firm. General partner has unlimited liability. Other options are false since
2: Income depends upon the agreement and not the type of partner he is.
3: Profits are taxable
4: Control depends upon the roles defined in the deed.
5: Limited partner does not get complete control.
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