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Which of the following is NOT an essential feature of a partnership?

  1. A
    Sharing of profits and losses
  2. B
    Relationship of mutual agency among the partners.
  3. C
    Liability of partners is always unlimited.
  4. D
    Agreement to carry lawful business

Solution & Step-by-step Explanation

Let us evaluate the core legal characteristics of a partnership:Sharing of profits (A), Mutual Agency (B), and a Lawful Business Agreement (D) are all mandatory, essential features required to form a partnership under the Indian Partnership Act, 1932.Statement C: While partners generally face unlimited liability, modern corporate laws allow for the creation of a Limited Liability Partnership (LLP). In an LLP, the liability of partners is limited to their agreed capital contribution. As a result, unlimited liability is not always an essential feature across all forms of partnership.

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Which of the following is NOT an essential feature of a partnership?
A
Sharing of profits and losses
B
Relationship of mutual agency among the partners.
C
Liability of partners is always unlimited.
D
Agreement to carry lawful business

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PartnershipAccountingEssential Features

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