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AICPA CPA-Business Exam - Topic 2 Question 110 Discussion

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?
D) Lisa has a right to vote on the transferring of interest to and admission of Karen as a limited partner.
A) Lisa may engage in the management of the limited partnership without losing her limited liability.
B) Jen may transfer her interest and make Karen a new limited partner without the approval of the other partners.
C) Jen may withdraw from the limited partnership without giving notice to the partnership.

AICPA CPA-Business Exam - Topic 2 Question 110 Discussion

Actual exam question for AICPA's CPA-Business exam
Question #: 110
Topic #: 2
[All CPA-Business Questions]

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?

Show Suggested Answer Hide 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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Annmarie
7 months ago
D sounds right, Lisa should have a say in this!
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Kathrine
7 months ago
Wait, can Jen really just sell her interest like that?
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Teri
7 months ago
I think B is true, no need for approval!
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Jose
7 months ago
A is definitely wrong, limited partners can't manage.
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Rebecka
7 months ago
C is a no-go, notice is usually required.
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Gilma
8 months ago
I vaguely recall that withdrawing from a limited partnership usually requires notice. So, C seems unlikely to be true.
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Carla
8 months ago
I practiced a question similar to this, and I think limited partners have some rights regarding transfers. D might be the right choice.
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Vince
8 months ago
I’m not sure, but I feel like Jen might need approval from the other partners to transfer her interest. B could be tricky.
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Denae
8 months ago
I think I remember that limited partners generally can't manage the partnership without risking their liability. So, A seems wrong.
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Mary
9 months ago
This question is testing my knowledge of limited partnership law. I'll need to review my notes and make sure I understand the distinctions between the answer choices.
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Thaddeus
9 months ago
I'm feeling pretty confident about this one. The rules around limited partner rights and withdrawals seem clear to me.
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Cherry
9 months ago
Okay, I think I've got a handle on this. The key is understanding the limitations on a limited partner's involvement in management and the requirements for transferring interests.
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Rusty
9 months ago
Hmm, I'm a bit unsure about the specifics of limited partner transfers and approvals. I'll need to think through the options carefully.
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Solange
9 months ago
This seems like a straightforward limited partnership question. I'll need to carefully review the key details about limited partners' rights and responsibilities.
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Hubert
1 year ago
D is the way to go. Lisa's got to have a vote on this, otherwise it's not a fair process.
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Helene
1 year ago
D) Lisa has a right to vote on the transferring of interest to and admission of Karen as a limited partner.
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Leonida
1 year ago
B) Jen may transfer her interest and make Karen a new limited partner without the approval of the other partners.
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Reta
1 year ago
A) Lisa may engage in the management of the limited partnership without losing her limited liability.
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Thea
1 year ago
Haha, imagine Lisa trying to manage the partnership and still keep her limited liability. What a joke!
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Joanna
1 year ago
D) Lisa has a right to vote on the transferring of interest to and admission of Karen as a limited partner.
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Gianna
1 year ago
B) No way, that's not how it works. Lisa can't manage and keep her limited liability.
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Mireya
1 year ago
A) Lisa may engage in the management of the limited partnership without losing her limited liability.
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Gerald
1 year ago
I think C is a trick question. Limited partners can't just withdraw without notice.
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Felix
1 year ago
I agree, C is definitely a trick question. Limited partners can't just withdraw without notice.
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Georgeanna
1 year ago
B) Jen may transfer her interest and make Karen a new limited partner without the approval of the other partners.
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Lea
1 year ago
A) Lisa may engage in the management of the limited partnership without losing her limited liability.
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Jettie
1 year ago
B is definitely not true. You can't just transfer your interest without approval.
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Effie
1 year ago
B is definitely not true. You can't just transfer your interest without approval.
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Wenona
1 year ago
D) Lisa has a right to vote on the transferring of interest to and admission of Karen as a limited partner.
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Nakisha
1 year ago
A) Lisa may engage in the management of the limited partnership without losing her limited liability.
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Vi
1 year ago
D seems like the right answer. Lisa should have a say in who becomes a new partner.
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Marta
1 year ago
Yes, it's important for all partners to have a say in such decisions. Lisa's rights should be protected.
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Fausto
1 year ago
I agree, D is the correct answer. Lisa should definitely have a say in the admission of a new partner.
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Goldie
1 year ago
But if Lisa engages in management, wouldn't she lose her limited liability?
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Rosalyn
1 year ago
I disagree, I believe the answer is A.
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Goldie
1 year ago
I think the answer is D.
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