GROWTH DEVELOPMENT CHILD
DEVELOPMENT AND LEARNING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Advantages of Partnership
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Disadvantages of Partnership
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Deed of partnership
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limited partnership
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Detailed explanation-1: -Within a partnership, members are vulnerable to unlimited liability for their overall actions. Every partner is personally liable for any company debts and responsibilities. If the company lacks the assets to cover an organizational debt, then creditors can seize the partners’ personal assets to cover that debt.
Detailed explanation-2: -Unlimited liability for debts In most business partnerships the partners all have unlimited liability and so are personally liable for any business debts. In a sole proprietorship business the one individual – known as the sole proprietor – has the entire responsibility for all debts, accountability and duties.
Detailed explanation-3: -Sole proprietors have unlimited liability and are legally responsible for all debts against the business. Their business and personal assets are at risk. May be at a disadvantage in raising funds and are often limited to using funds from personal savings or consumer loans.
Detailed explanation-4: -Disadvantages of a partnership include that: the liability of the partners for the debts of the business is unlimited. each partner is ‘jointly and severally’ liable for the partnership’s debts; that is, each partner is liable for their share of the partnership debts as well as being liable for all the debts.