Final answer:
The correct statement about a partnership is that it involves unlimited liability for all partners, where each partner might be held personally responsible for the business's debts and obligations. Partners share both the risks and decision-making responsibly, which can impact personal assets. This contrasts with a corporation, where the owners are protected from liabilities beyond their investment. option (D)
Step-by-step explanation:
The correct statement about a partnership is c) Unlimited liability for all partners. In a standard general partnership, all partners share equal responsibility for the business's debts and obligations, and their personal assets might be at risk if the business entity cannot meet its financial obligations. This is vastly different from the limited liability offered to the shareholders of a corporation, where individual owners are protected against business failures beyond their investment in the company.
General partnerships provide opportunities for partners to share both the responsibilities and the risks of the business, with each partner being responsible for the actions of the others. Although the partnership structure allows for equal decision-making and shared management, it exposes personal assets to business risks. When one partner leaves or a partner dies, the structure and existence of the partnership may change significantly. These legal and financial aspects differ sharply from a corporation, which is recognized as a separate legal entity that shields its owners from personal liability beyond their investment.