Disadvantages of a partnership include:
A)Unlimited life and mutual agency.
B)Mutual agency and limited liability.
C)Unlimited liability and unlimited life.
D)Limited Life and limited liability.
E)Limited life,mutual agency and unlimited liability are all disadvantages of a partnership

Question

Quizplus · Accepted Answer

A partnership has unlimited life unless stated otherwise in the partnership agreement, which means that the partnership will dissolve upon the death, retirement or withdrawal of a partner unless a provision is made for it in the partnership agreement. Mutual agency means that each partner can act on behalf of the partnership and bind the partnership to contracts or other obligations, which can lead to disputes and difficulties if partners do not agree on decisions. Unlimited liability means that the partners are personally liable for the debts and obligations of the partnership, which puts their personal assets at risk. Therefore, limited life, mutual agency, and unlimited liability are all disadvantages of a partnership, making option E the best choice.

Disadvantages of a Partnership Include