What Is One of the Drawbacks of Switching from a Partnership

question 61

Multiple Choice

What is one of the drawbacks of switching from a partnership to the corporate form of organization?

• A)It subjects the firm to additional regulations.
• B)It makes it more difficult for the firm to raise additional capital.
• C)It makes the firm's investors subject to greater potential personal liabilities.
• D)It makes it more difficult for the firm's investors to transfer their ownership interests.

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Definitions:

Turns Ratio

The ratio of the number of turns in the primary winding to the number of turns in the secondary winding of a transformer, determining its voltage transformation characteristics.

Primary Voltage

The voltage at the input of a transformer or any primary side of an electrical system.

Primary Phase Current

The initial or main current flow in one phase of a system before splitting into secondary phases or circuits.

Resistive Load

An electrical load that consumes energy in the form of heat or light, behaving according to Ohm's law.