Maya plans to open a shop specializing in foods and cultural items from the Middle East. She wants to be the firm's only general partner, but she is trying to get several friends to participate as limited partners. Apparently Maya wants to:
A) limit her personal liability to the amount she personally invests in the company.
B) keep all of the firm's profits.
C) obtain a strong financial base for the firm while maintaining personal control over the firm's management.
D) meet the legal requirements of the Uniform Partnership Act.

Question

Quizplus · Accepted Answer

Maya's plan to have limited partners allows her to obtain a strong financial base for the firm while maintaining personal control over the firm's management. By having limited partners, Maya can raise more capital while at the same time keeping her personal liability limited to the amount she personally invests in the company. Option A is true, but only explains one aspect of Maya's plan. Option B is incorrect because in a partnership, profits are typically distributed among the partners based on their ownership share. Option D may be a consideration, but Maya's main goal is to obtain a strong financial base for the firm while maintaining personal control.

Maya Plans to Open a Shop Specializing in Foods and Cultural