A disadvantage of a general partnership, compared to a regular corporation, is that:

Question

Quizplus · Accepted Answer

One disadvantage of a general partnership is that partners are subject to unlimited personal liability for debts of the business. This means that if the business can't pay its debts, creditors can go after the personal assets of the partners. This is in contrast to a regular corporation, where owners' personal assets are typically protected from business debts. Option A is incorrect because partnerships generally require fewer formalities and are less expensive to set up than corporations. Option B is incorrect because partnership income is not subject to double taxation - instead, it is taxed at the individual level. Option D is incorrect because partnerships do not typically require charters from the state to be established.

A Disadvantage of a General Partnership, Compared to a Regular