In an LLP, the liability of partners is:a.Limited to their capital contributionb.Limited to their share of profitsc.Unlimited and jointd.Unlimited but several
Question
In an LLP, the liability of partners is:a.Limited to their capital contributionb.Limited to their share of profitsc.Unlimited and jointd.Unlimited but several
Solution
In a Limited Liability Partnership (LLP), the liability of partners is:
a. Limited to their capital contribution
This means that each partner's liability is limited to the amount of money they have invested in the business. If the LLP incurs debts or is sued, the partners are not personally responsible for covering these costs beyond the amount they have contributed to the LLP. This is the key feature that differentiates an LLP from a traditional partnership, where partners have unlimited liability for the partnership's debts.
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