Accountancy Part AAccounting for Partnership

The Liability of the partners in a firm is__________

Answer & explanation

Correct answer: option 3

The correct answer is Option (3) → Unlimited and private assets can also be used for paying off the firm's debts

NCERT (2026-27 edition):
Nature of Partnership – “… 6. Liability of Partners: Each partner is liable jointly with all the other partners and also severally to the third party for all the acts of the firm done while he is a partner. Not only that the liability of a partner for acts of the firm is also unlimited. This implies that his private assets can also be used for paying off the firm’s debts.”