$1\mathrm{.}4$ DISADVANTAGES OF PARTNERSHIP BUSINESS $(5)$

$1.$Unlimited Liability: Each partner has an unlimited liability for all the partnership debts. Thus

if one partner becomes insolvent, the other solvent partners have to pay his share of loss.

$2.$Difficulty in Transfer of Share: A partner cannot sell his interest in the firm nor can partner

succeed to partnership without the consent of all other partners.

$3.$Managerial Difficulties: The partnership form of business may delay some important

decisions until all the partners are present on the spot for discussion and consultation.

Moreover, interruption into the day$-$to$-$day affairs by every partner may cause injury to the

firm and create trouble in executing and discharging the firm$$s policies and duties.

$4.$Limited Life: It is broken up at the death or withdrawal of any partner, or at his becoming

insane or bankrupt.

$5.$Joint Ownership: Since there is no separate entity of partnership in the eyes of law, the

property of the firm is held in joint names of all the partners.

$6.$Limitation of Funds: Although more funds can be raised by a partnership in comparison to

sole proprietorship, these may not be sufficient for establishment of a large enterprise for

which a limited liability company can be appropriate.

Choose the most correct answer,from A$-$E below. $(5)$

A$.$ Creation of a Partnership is purely a matter of agreement between the parties such an

agreement must be in writing.

B$.$ Should the business fail, creditors must initially try to recover monies against the

business's assets. Then, if any amount is left unpaid after the Partnership has been

sequestrated and all assets sold, a creditor cannot claim against the personal assets of the

individual partners.

C$.$ Anonymous $($sleeping$)$ Partnerships: the anonymous partner is well known to the public

and is liable to the partners for the pro rata share.

D$.$Although more funds can be raised by a partnership in comparison to sole proprietorship,

these may not be sufficient for establishment of a large enterprise for which a limited liability

company can be appropriate.

E$.$ A partnership does have a juristic personality separate from the partners.

Use the Harvard referencing method.