Asked by Nicole Guerrero on Apr 28, 2024
Verified
Poxabogue Associates,a partnership,is dissociated by the retirement of a partner.The business is continued by the remaining partners and a new partner,Enrica.What is Enrica's liability to creditors for partnership obligations that arose before she became a partner?
A) Enrica is liable to the extent of partnership assets.
B) Enrica is liable only if she agrees to assume the retired partner's liability.
C) Enrica is fully liable.
D) Enrica has no liability.
Partnership Obligations
The duties and responsibilities that partners in a business partnership have towards each other, the partnership itself, and third parties, including financial and fiduciary duties.
Dissociated
Pertaining to a member who has ended their involvement with or participation in a business entity.
- Examine the impact on liabilities and partnership activities when there is a change in the partnership through a partner's departure or the addition of a new partner.
- Comprehend the impact of changes within a partnership's structure on its financial obligations and liabilities to creditors.
Verified Answer
VS
VAnsh SinghaniaApr 29, 2024
Final Answer :
D
Explanation :
The RUPA states that a new partner has no liability for partnership obligations incurred before he became a partner.
Learning Objectives
- Examine the impact on liabilities and partnership activities when there is a change in the partnership through a partner's departure or the addition of a new partner.
- Comprehend the impact of changes within a partnership's structure on its financial obligations and liabilities to creditors.