Question

What is meant by “Unlimited Liability of a Partner”?

Answer 1

Unlimited liability of a partner means that each partner in a partnership firm is personally responsible for all the debts and obligations of the firm. If the firm’s assets are insufficient to cover its liabilities, the personal assets of the partners can be used to pay off the firm’s debts. This liability is not limited to the amount invested in the firm, and partners are liable to the full extent of their personal wealth.