A Partnership Designed to Protect Innocent Partners from Malpractice or Negligence

question 63

Multiple Choice

A partnership designed to protect innocent partners from malpractice or negligence claims resulting from acts of another partner is a:

• A)Partnership
• B)Limited partnership
• C)Limited liability partnership
• D)General partnership
• E)Limited liability corporation

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Definitions:

Impairment Model

Impairment Model is an accounting method that requires assets to be reviewed for impairment, whereby their carrying value is adjusted to reflect their recoverable amount if this is less than their current book value.

Indefinite-Lived Assets

Non-physical assets without a predefined expiry date in terms of economic benefits or usefulness.

Amortization

The systematic reduction of a loan or the spreading out of capital expenses for intangible assets over a specific period of time for accounting and tax purposes.

Fair Value

Fair value is the price that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.