A major disadvantage of the partnership form of ownership and management is that it _____.
A)is subject to double taxation
B)faces more government rules than other ownership forms
C)binds all partners to actions made by any individual partner acting on behalf of the firm
D)may separate ownership from management

Question

Quizplus · Accepted Answer

In a partnership, all partners are personally liable for the actions of any individual partner acting on behalf of the firm. This can lead to disputes and financial problems if one partner makes a mistake or engages in unethical behavior. Additionally, partnerships may face challenges in the decision-making process due to differing opinions and goals among partners. However, partnerships do not face double taxation like corporations and generally have fewer government regulations than other ownership forms. Partnership also allows for shared management responsibilities, which can bring a diversity of skills and perspectives to the business.

A Major Disadvantage of the Partnership Form of Ownership and Management