Partners of a Partnership

question 68

Multiple Choice

Partners of a partnership:

• A) are not liable for all the obligations of their partnership.
• B) are entitled to income of the partnership,which must be reported on their individual federal income tax returns.
• C) are not permitted to deduct partnership losses on their individual federal income tax returns.
• D) can create a partnership only by complying with a statute.

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Definitions:

Marginal Cost

The extra expenditure required to produce one additional unit of a product or service.

Marginal Benefit

Marginal Benefit is the additional satisfaction or utility gained by consuming one more unit of a good or service.

Expected Profitability

The forecasted return on investment for a business activity or project, considering potential profits and losses.

Interest-Rate Cost

The expense associated with borrowing money, reflected as a percentage of the total amount borrowed.