Partnership

Topic Content:

Partnership is a business organization owned and controlled by two or more people. It can also be defined as a relationship that exists when two to twenty people agree, decide to run a business together, and share the risks and profit of the business. 

Features of Partnership:

1. Pooling of both mental and material resources together.

2. Ownership is from two to twenty persons or two to ten persons for a banking business.

3. The partnership has unlimited liability except for the limited partner.

4. They have a limited source of finance.

5. The partners contribute funds and skills according to the agreement reached and share the profit.

6. Major decisions are taken together.

7. Risks to the business are borne together.

8. The business is not a legal entity.

Partnership Deed:

For the Formation of a partnership, business partners must have a written document or agreement that will guide the business for effectiveness and efficiency. The agreements, rules, and regulations guiding the partners are known as a deed of partnership.

The Deed Contains Some or