There are two statements Assertion (A) and Reason (R):
Assertion (A): Private assets of a partner can also be used for paying off the firm’s debts.
Reason (R): Liability of a partner for acts of the firm is limited.
Choose the correct alternative from the following:
Assertion (A): Private assets of a partner can also be used for paying off the firm’s debts.
Reason (R): Liability of a partner for acts of the firm is limited.
Choose the correct alternative from the following:
Show Hint
- Assertion (A) is incorrect, but Reason (R) is correct.
- Assertion (A) is correct, but Reason (R) is incorrect.
- Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A).
- Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
The Correct Option is B
Solution and Explanation
Step 2: The Reason (R) says "Liability of a partner for acts of the firm is limited," which is incorrect because in a general partnership, each partner has unlimited and joint liability.
Step 3: Therefore, Assertion (A) is correct, but Reason (R) is incorrect.
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