Which of the following statements is correct with respect to limited partnerships?
A) A limited partnership is created where all of the partners state in the partnership agreement that they will not be responsible for debts arising out of the partnership business and register as such with the government.
B) A limited partner is totally protected and can lose no money.
C) A limited partner can lose his status as a limited partner if he participates in the management of the business.
D) There can be no limited partnerships in Canada. If limited liability is desired, a corporation must be created.
E) There can only be one limited partner in any partnership, no matter how many partners are involved.

Question

Quizplus · Accepted Answer

A limited partner can indeed lose their status as a limited partner if they participate in the management of the business, which is a key distinction in how limited partnerships operate. This involvement can make them liable as a general partner would be.

Which of the Following Statements Is Correct with Respect to Limited