Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 3 - No. 14)
What does the term 'limited liability' mean in the context of a limited company?
The company's assets are limited.
The company's debts are limited.
The personal assets of the shareholders are protected from the company's debts.
The company's operations are limited.
Explanation
Limited liability means the shareholders' personal assets are protected from the company's debts.
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