Which of the following is a significant disadvantage of a general partnership?
A) The cost of forming it is high.
B) Each partner is fully responsible for the liabilities incurred by the partnership.
C) There is a risk associated with the industry in which it operates.
D) Forming the business is very complex.

Question

Quizplus · Accepted Answer

In a general partnership, each partner is personally and fully responsible for the debts and liabilities of the partnership. This means that if the partnership is unable to pay its debts or is sued, each partner could be held financially liable, even if they did not personally cause the issue. This can put personal assets at risk and is a significant disadvantage of this type of business structure.

Which of the Following Is a Significant Disadvantage of a General