limited illam and Nigel decide to start a partnership business. They ask their f
ID: 329535 • Letter: L
Question
limited illam and Nigel decide to start a partnership business. They ask their friend Sophia to become a parther in order to help them with additional funds to get the business started. Which of the following statements about Sophia would be correct if she becomes and remains a limited partner in this scenario A. Sh B. C. e may be involved in management of the business but to a rather limited degree. She cannot be entitled to any share in the profits of the business. She may lose her investment if the business fails, but she will have no personal liability for partnership debts. D. She may be considered an employee and therefore will be entitled to wages for the services she rend to the partnership.Explanation / Answer
The correct option is option C
A limited partner cannot participate in daily operation or management in the company. The limited partner gets the profit as per his or her share. The limited partner gets the profit as per the investment and if the loss is there then the limited partner bears the loss as well. So the Third option is correct.
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