Jim is one of several general partners who own Beef 'N Beer, a small chain of restaurants located in Missouri and Illinois. Jim is interested in converting the partnership into a master limited partnership. If he convinces other partners to go along with his idea, Beef 'N Beer will:
A) offer shares of ownership that are traded on a stock exchange much like a corporation.
B) pay its taxes like a corporation.
C) begin to operate much like a sole proprietorship.
D) have to change its name to include the term Ltd. in its title to indicate its owners have limited liability.

Question

Quizplus · Accepted Answer

A master limited partnership (MLP) is a type of partnership that is traded publicly on a stock exchange. MLPs are commonly used in the energy industry and offer investors tax benefits and high yields. By converting to an MLP, Beef 'N Beer would be able to raise capital by selling shares of ownership to the public, similar to a corporation. The other options listed (B, C, and D) are not accurate descriptions of what would happen if the partnership were converted to an MLP.

Jim Is One of Several General Partners Who Own Beef