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Question
self checks can be taken as many times as youd like. your ins question 2 which of the following entities are subject to limited liability? general partnerships sole proprietorships limited partnerships corporations
- General partnerships: Partners have unlimited liability.
- Sole proprietorships: Owner has unlimited liability.
- Limited partnerships: Limited partners have limited liability, general partners have unlimited. But the option is about the entity; also, corporations have shareholders with limited liability (losses limited to investment).
- Corporations: Shareholders' liability is limited to their investment. So corporations (and limited partnerships' limited partners, but the option "limited partnerships" as an entity—however, corporations are a clear example of limited liability for owners. Wait, re - check: Limited partnerships: the limited partners have limited liability, the general partner has unlimited. But the question is which entities are subject to limited liability (the owners of the entity). For corporations, shareholders have limited liability. For limited partnerships, the limited partners do. But among the options, corporations are a standard example of limited liability (owners' liability limited to investment). Also, limited partnerships: the entity's owners (limited partners) have limited liability. But let's recall:
General partnerships: all partners have unlimited liability.
Sole proprietorship: owner has unlimited liability.
Limited partnerships: limited partners have limited liability (general partner has unlimited). So the entity "limited partnerships" has some owners with limited liability. But corporations: all shareholders have limited liability (losses up to their investment). So both limited partnerships (for limited partners) and corporations have limited liability for their owners. Wait, but maybe the question is considering the entity's owners. Let's check standard business law:
- Corporations: Shareholders are not personally liable for corporate debts (limited liability).
- Limited partnerships: Limited partners' liability is limited to their investment; general partners have unlimited liability. So the entity "limited partnerships" has owners with limited liability (the limited partners). But sometimes, in such questions, corporations are a more straightforward answer, and also limited partnerships. Wait, but the options are:
Options:
A. general partnerships
B. sole proprietorships
C. limited partnerships
D. corporations
So let's analyze each:
- General partnerships: Partners are jointly and severally liable (unlimited), so no.
- Sole proprietorships: Owner is personally liable (unlimited), so no.
- Limited partnerships: Limited partners have liability limited to their investment (general partners have unlimited). So the owners of the limited partnership (limited partners) have limited liability. So the entity "limited partnerships" has owners with limited liability.
- Corporations: Shareholders have liability limited to their investment in the corporation. So shareholders (owners) have limited liability.
So both C and D? Wait, maybe the question is from a business law perspective where corporations are a classic example, and limited partnerships also have limited liability for limited partners. But maybe in the context of the question, the intended answers are limited partnerships (C) and corporations (D). Wait, but let's check typical textbook questions. In many business courses, corporations are a primary example of limited liability, and limited partnerships (the limited partners) also have limited liability. So the correct options are C. limited partnerships and D. corporations. Wait, but let's confirm:
In a limited partnership, there are two types of partners: general partners (u…
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C. limited partnerships, D. corporations