Which of the Following Is a Characteristic of a Limited-Liability

question 9

Multiple Choice

Which of the following is a characteristic of a limited-liability partnership (LLP) ?

• A)One partner cannot be held responsible for the inappropriate actions of another partner.
• B)Partners' personal liability is limited to the amount they have invested in the business.
• C)Each partner is liable for the actions of all other partners.
• D)As a separate legal entity,the partnership must pay taxes on income.

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Definitions:

Long-term Debt

Loans and financial obligations lasting more than one year that a company owes to external parties.

Contingent Liability

A potential liability that may become an actual liability in the future.

Warranty Expense

Costs associated with the obligation to repair or replace a product due to defects for a specified period.

Bad Debt Expense

An expense account to record uncollectible receivables.