ACCA BT · Chapter 1 · Question 4 of 11
Henrik owns a small accountancy practice in partnership with two colleagues. Which of the following is a feature of an ordinary (unlimited) partnership compared with a limited company?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) The partners are personally liable for the debts of the business without limit
Explanation
In an ordinary partnership the partners have unlimited personal liability for the firm's debts. A limited company has separate legal personality, its shares can be transferred, and it must file accounts publicly, with an audit normally required above certain size thresholds. Those features do not apply to an ordinary partnership.
More Business organisation, structure and strategy MCQs
- Q6According to Mintzberg, which organisational configuration relies mainly on the standardisation of skills, with the operating core as its…
- Q7An organisation has a structure in which employees report both to a functional manager and to a project manager. What type of structure is…
- Q8Which of the following is most likely to be a consequence of a wide span of control?
- Q9A company transfers its payroll, accounts payable and credit control activities from each of its regional subsidiaries into one central…
- Q10Johnson, Scholes and Whittington distinguish levels of strategy. A decision by a diversified group about which industries it should…