Which of the following is a strong feature of partnership?

  • A The life of the partnership is generally assumed to be indefinite
  • B The owners are liable personally for all debts of the business
  • C The transfer of ownership interest is frequent and easy to accomplish
  • D The partnership is complex to form because of many legal and reporting requirements
jamb 1995accounting

The correct answer is B. The owners are liable personally for all debts of the business

A strong feature of a partnership is the owners are liable personally for all debts of the business.

This is known as unlimited liability, and it means that if the partnership cannot meet its financial obligations, the partners' personal assets may be used to pay off the debts.

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