6-2 Partnerships

What is a partnership in business?

• A non-profit organization

• A corporation with multiple shareholders

• A business owned by one person

• A business structure where two or more entities share ownership

Which of the following is an advantage of a partnership?

• Unlimited liability for all partners

• Sharing the costs of starting and running a business

• No need for a partnership agreement

• No sharing of profits

What is a disadvantage of adding partners?

• Increased personal liability

• Sharing profits and control

• Increased decision-making power

• Reduced workload

How does a partnership compare to a sole proprietorship?

• Partnerships require more government forms

• Partnerships have more owners sharing profits and liabilities

• Partnerships file a separate tax return

• Partnerships have limited liability

What is included in a partnership agreement?

• A list of all business clients

• The business's annual revenue

• Capital contributions, responsibilities, and decision-making process

• Only the names of the partners

What are capital contributions in a partnership?

• The amount of money and resources each partner contributes

• The liabilities each partner assumes

• The taxes each partner pays

• The profits each partner receives

What is a general partnership?

• A partnership that is publicly traded

• A partnership with only one partner

• A partnership where each partner has unlimited liability

• A partnership where partners have limited liability

What is a limited partnership?

• A partnership that does not require a formal agreement

• A partnership with both general and limited partners

• A partnership where all partners have unlimited liability

• A partnership with no general partners

Who are limited partners?

• Partners who have unlimited liability

• Partners who manage day-to-day operations

• Partners who are liable for all business debts

• Partners who are involved as investors and have limited liability

What is a master limited partnership (MLP)?

• A partnership that is not publicly traded

• A partnership with no tax benefits

• A partnership with only limited partners

• A partnership that combines tax benefits and is publicly traded