5. Kraft is a limited partner of Johnson Enterprises, a limited partnership. As provided in the limited partnership agreement, Kraft decided to leave the partnership and demanded that her capital contribution of $20,000 be returned. At this time, the partnership assets were $150,000 and liabilities to all creditors totaled $140,000. The partnership returned to Kraft her capital contribution of$20,000. a. What liability, if any, does Kraft have to the creditors of Johnson Enterprises? b. If Johnson Enterprises had been formed as a limited liability company, what liability, if any, would Kraft have to the creditors of Johnson Enterprises?
5. Kraft is a limited partner of Johnson Enterprises, a limited partnership. As provided in the limited partnership agreement, Kraft decided to leave the partnership and demanded that her capital contribution of $20,000 be returned. At this time, the partnership assets were $150,000 and liabilities to all creditors totaled $140,000. The partnership returned to Kraft her capital contribution of$20,000. a. What liability, if any, does Kraft have to the creditors of Johnson Enterprises? b. If Johnson Enterprises had been formed as a limited liability company, what liability, if any, would Kraft have to the creditors of Johnson Enterprises?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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5. Kraft is a limited partner of Johnson Enterprises, a limited partnership. As provided in the limited partnership
agreement, Kraft decided to leave the partnership and
demanded that her capital contribution of $20,000 be
returned. At this time, the partnership assets were
$150,000 and liabilities to all creditors totaled $140,000.
The partnership returned to Kraft her capital contribution of$20,000.
a. What liability, if any, does Kraft have to the creditors
of Johnson Enterprises?
b. If Johnson Enterprises had been formed as a limited
liability company, what liability, if any, would Kraft
have to the creditors of Johnson Enterprises?
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