Asked by Trang Nguyen on Jul 02, 2024
Jim and Rob are partners in a consulting business. Jim's initial contribution was $30,000, Rob's was $20,000. Emily is a limited partner who contributed $10,000. The partnership also borrows $60,000 from Vancouver Credit Union. The partners agree that profits and losses will be shared in proportion to their capital contributions. The business fails. Jim pays the entire $60,000 debt to the Vancouver Credit Union. How much can he collect from Emily?
A) $60,000
B) $30,000
C) $20,000
D) $10,000
E) Nothing
Limited Partner
A partner who may not actively participate in the management of the firm, but has limited liability.
Vancouver Credit Union
A financial cooperative based in Vancouver that offers banking services, such as savings and loans, to its members.
Capital Contributions
Investments made by owners or shareholders in a company, often in the form of cash or other assets, to provide funding for the company's operations or growth.
- Comprehend the legal nuances differentiating general and limited partners, particularly regarding their liabilities and authorities in operations.
- Acknowledge how personal debts and partner activities impact the partnership and its constituent partners.
Learning Objectives
- Comprehend the legal nuances differentiating general and limited partners, particularly regarding their liabilities and authorities in operations.
- Acknowledge how personal debts and partner activities impact the partnership and its constituent partners.
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