"John's Designs" is an architectural firm owned by four investors.John is the only one who handles the day-to-day business management of the firm,though the profits are shared equally with the losses being restricted to the amount invested by each.This is an example of a ________.

Question

Quizplus · Accepted Answer

This is because there are four investors, indicating that this is not a sole proprietorship. The fact that profits are shared equally while losses are restricted to the amount invested by each investor suggests a limited partnership structure rather than a general partnership or corporation. A limited liability corporation (LLC) would also restrict losses to the amount invested by each investor, however, they can choose how to split the profits, unlike in this scenario where it is shared equally.

"John's Designs" Is an Architectural Firm Owned by Four Investors