Another Business Law Question???

Tom is one of the partners in a new partnership. If debts of the firm become due, and the firm cannot pay them, Tom will be
a. personally liable for those debts and obligations.
b. liable for those debts and obligations only up to the amount of his capital contribution.
c. not required to contribute any money to the satisfaction of these debts and obligations.
d. none of the above.

the anwer is opton a b.coz in an partnership firm the liability of partners is unlimted which means they have to sell their personal assets to pay the debt amt .i do agree with the anwer given above

In a corporation he would be liable for his investment only. In a proprietorship he would be liable for those debts and obligations. To me a partnership is simply a proprietorship with two people. There needs to be sellout or buyout clause so the business can continue if the two minds are not in agreement as to which way to go.

a.personally liable for those debts and obligations

Partners are severally and jointly liable for partneship debts.

Tags

　　Capital Investment 　　Business Investment 　　Business financing 　　Business Invest 　　Business Debt 　　Bond Investment 　　Angel Funds 　　Alternative Investment

Related information

Business Law help???

without knowing what kind of partnership he is engaged in the question is impossible to answer. i do not believe that a guess is helping you any. maybe you could elaborate and inform on the struct...

I would like to know what level of offer I can make to the IRS for Offers in Compromise of an old IRS debt?

OIC is strictly YOUR ability. If there is any chance that you can make payments, they won't accept OIC. Even if it takes 5 or 10 years. The only exception is if there is a possibility of no...

If you've PAID CASH for a home - a percentage of which is now used for business, can that be a tax write-off?

You can take a depreciation deduction as part of your home office deduction for the portion of your home used exclusively for business. You do NOT need to pay yourself "rent" to get the ...

Bankruptcy question...PLEASE HELP?!?

If your parents put the house in your name today, and then filed bankruptcy tomorrow or even 5 years from now, I guarantee you the trustee would intervene and try and sell the house. Especially if...

Self Employed...what should we do with windfall?

Definately pay off credit cards and any other high-interest debt first. If your husband already has a new job lined up that will make this time much easier. If his new salary is enough to cover y...

I am going bankrupt, or rather being made so by the dreaded vat man, will my husband inherit my debts?

Your presonal debts are Yours alone! any jointly owned property can be seized however anything owned soley by your husband is HIS. being made bankrupt meands that everythig you have is used to...

Bankruptcy Double Jeopardy? Can my ex-spouse be sued over one of my debts?

If he was a joint holder of the account this is perfectly legal...the creditor is giving themselves too much credit though. Most judges will still discharge the debt anyway, it just holds up the p...

Tax question?

A non-business or private debt is not deductable on your personal income taxation return. A busienss bad debt is a debt that is outstanding but no longer persuded by the creditor. This is diferent ...