AICPA Exam CPA-Business Topic 2 Question 110 Discussion

Actual exam question for AICPA's CPA-Business exam

Question #: 110
Topic #: 2

Lisa is a limited partner in a limited partnership. Jen, one of the other limited partners, is seeking to sell her interest in the partnership to Karen and allow Karen to become a new limited partner. Which of the following statements is true?

ALisa may engage in the management of the limited partnership without losing her limited liability.

BJen may transfer her interest and make Karen a new limited partner without the approval of the other partners.

CJen may withdraw from the limited partnership without giving notice to the partnership.

DLisa has a right to vote on the transferring of interest to and admission of Karen as a limited partner.

Show Suggested Answer

Suggested Answer: D

Choice 'd' is correct. Limited partners have the right to vote on the transfer of interest and admission of a new partner. Admission of a new partner requires unanimous consent.

Choice 'a' is incorrect. A limited partner who acts as a general partner loses her limited liability status to those she acted as a general partner towards.

Choice 'b' is incorrect. Partners can freely transfer their interests in profits and losses to third parties, but the third party cannot become a limited partner without the unanimous consent of the other partners.

Choice 'c' is incorrect. Limited partners must give 6 months notice of withdrawal in absence of an agreement to the contrary.

by Broderick at Apr 07, 2025, 05:27 PM

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Goldie

4 days ago

I think the answer is D.

upvoted 0 times

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