BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Limited liability
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Capital contributed by way of ordinary share
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Income from the business is not subject to tax
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Profit or loss is divided among owners and members
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Detailed explanation-1: -In a business partnership, you can split the profits any way you want, under one condition-all business partners must be in agreement about profit-sharing. You can choose to split the profits equally, or each partner can receive a different base salary and then the partners will split any remaining profits.
Detailed explanation-2: -Divide the Partnership Loss The net loss is divided according to each partner’s contribution percentage, according to Henssler Financial. For example, Partner A gets 50 percent of the profits and losses, Partner B gets 30 percent and Partner C gets 20 percent of the partnership’s profits and losses.
Detailed explanation-3: -Limited Partnership and Partnership With Limited Liability In these types of partnerships, most of the partners (to the extent of their investment) have limited liability, along with limited input in management decisions.