GK
BUSINESS MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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When the owner has no liability because the business is owned by another individual/company
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When the owner has somewhat liability
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When two individuals agree on their company’s liability being shared between them
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When the owner has full liability to the extent of their personal assets
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Detailed explanation-1: -Unlimited liability refers to the full legal responsibility that business owners and partners assume for all business debts. This liability is not capped, and obligations can be paid through the seizure and sale of owners’ personal assets, which is different than the popular limited liability business structure.
Detailed explanation-2: -Unlimited liability is when one or more individuals are liable for their company’s taxation and debts. In this regard, it is very different to a limited liability company (LLC). The latter is designed specifically to insulate individual LLC members (partners or stakeholders) from risk.
Detailed explanation-3: -Unlimited liability means that any owners/shareholders share responsibility for debts in the case that a business fails, or to settle any legal proceedings (for example, a lawsuit due to employee injury on the job).
Detailed explanation-4: -It means that a partner is liable jointly and also separately fro all the debts of the firm. His private assets can be used for paying off the firm’s debts.