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INDEX
1. Introduction
2. Definitions 3. Features 4. Merits 5. Demerits
6. Types of
Introduction
Partnership is a form of business
Definitions : Partnership
Partnership is the relation between
two or more persons who have agreed to share the profits of the business carried on by all or any of them acting for all.
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partnership with one another are called individually PARTNERS and collectively FIRM.
Features : 1.Membership
There must be minimum 2 and
Features : 2.Agreement
There
must be an agreement between the partners to form a partnership either oral or written also known as Partnership Deed .
Feature : 3.Business
A partnership may undertake any
lawful business activity. The partnership can be formed only for the purpose of carrying on business which is legal.
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on other partners. Thus, partnership business can be carried on by all or by any of them acting for all.
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Illustration :-
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Merits of Partnership
Easy to Form
Risk sharing
Division of work
Motivation
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Demerits of Partnership
Unlimited Liability Nontransferab ility of shares
Conflicts
Risk of mutual agency
Uncertainty
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Types of Partnership
Partnership
At will
Fixed period
particular
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Types of Partners
Partners
Active
Dormant
Secret
Nominal
Minor
By estoppel
By holding out
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Active Partners
The active partner participates in
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Dormant Partners
The
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Secret Partners
The connection and relation of the
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Minor Partner
The partnership Act 1932 does not
permit a minor to become a partner in the partnership firm. The minor can only be admitted to the benefits of the firm.
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Nominal Partners
Nominal partners are not the real
partners of the firm. They only lend their name and reputation for the benefit of the firm.
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Registration : Procedure
A partnership firm can be registered any
time. Partners have to apply to the registrar in a prescribed form along with registration fees & the information if authenticated, a certificate of registration will be issued. It is an evidence of existence of the firm.
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Registration : Procedure
Sample of an application form.
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My Views on Partnership
I think entering into a Partnership business
is much better option than running a sole proprietorship business. Partnership Firms Final accounts are similar to Sole proprietorship firms final accounts except the profit sharing & Capital A/c.
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