Question

Which of the following activities will cause a limited partner to lose his limited liability status? a. being employed by the general partner as an employee b. managing the firm with the general partner c. consulting with or advising the general partner d. All of the above will result in the loss of limited liability status.

Answer 1

"Managing the firm with the general partner" activities will cause a limited partner to lose his limited liability status.

Answer: Option B

Step-by-step explanation:

When the economic liability of an individual is restricted to a rigid sum, the importance of a person's financing in a company or partnership is most prevalent, thus understood as "Limited liability". If a limited liability business is charged, then the plaintiffs sue the company and not its proprietors or investors.

The same is accurate in a limited partnership for participants of a limited liability partnership and limited associates. Thus general partners can lead to instability in firm regarding liability required to perform by them.