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Amar, Akbar and Anthony jointly started business of supplying cottons and agreed to share profits equally through oral agreement on 01.03.2007. Amar and Akbar are active partners, while Anthony is a sleeping partner.
Q.Is the Partnership firm valid?
- a)No, as the agreement was not a written one.
- b)No, as Akbar is not participating.
- c)No, as the firm has not been registered.
- d)Yes, because they agree to share profits.
Correct answer is option 'D'. Can you explain this answer?
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Most Upvoted Answer
Amar, Akbar and Anthony jointly started business of supplying cottons ...
Explanation:
The partnership firm in question is valid. Here's why:
- Agreement: The partners, Amar, Akbar, and Anthony, have orally agreed to share profits equally. While a written agreement is always recommended, an oral agreement is also legally valid in most jurisdictions. Therefore, the absence of a written agreement does not render the partnership invalid.
- Active and Sleeping Partners: The partnership consists of both active partners (Amar and Akbar) and a sleeping partner (Anthony). Active partners are involved in the day-to-day operations of the business, while sleeping partners provide capital but do not participate actively. This arrangement is common in partnerships and does not affect the validity of the firm.
- Registration: While registration of a partnership firm is advisable for various legal benefits, it is not a mandatory requirement for the partnership to be valid. In many jurisdictions, partnerships can operate without formal registration. Therefore, the absence of registration does not invalidate the partnership.
- Profit Sharing: The partners have agreed to share profits equally. Profit sharing is a fundamental aspect of a partnership and is evidence of a valid partnership agreement.
In conclusion, the partnership firm in question is valid despite the absence of a written agreement, the presence of a sleeping partner, and the lack of registration. The key factor is the mutual agreement to share profits, which establishes the existence of a partnership.
The partnership firm in question is valid. Here's why:
- Agreement: The partners, Amar, Akbar, and Anthony, have orally agreed to share profits equally. While a written agreement is always recommended, an oral agreement is also legally valid in most jurisdictions. Therefore, the absence of a written agreement does not render the partnership invalid.
- Active and Sleeping Partners: The partnership consists of both active partners (Amar and Akbar) and a sleeping partner (Anthony). Active partners are involved in the day-to-day operations of the business, while sleeping partners provide capital but do not participate actively. This arrangement is common in partnerships and does not affect the validity of the firm.
- Registration: While registration of a partnership firm is advisable for various legal benefits, it is not a mandatory requirement for the partnership to be valid. In many jurisdictions, partnerships can operate without formal registration. Therefore, the absence of registration does not invalidate the partnership.
- Profit Sharing: The partners have agreed to share profits equally. Profit sharing is a fundamental aspect of a partnership and is evidence of a valid partnership agreement.
In conclusion, the partnership firm in question is valid despite the absence of a written agreement, the presence of a sleeping partner, and the lack of registration. The key factor is the mutual agreement to share profits, which establishes the existence of a partnership.
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Amar, Akbar and Anthony jointly started business of supplying cottons and agreed to share profits equally through oral agreement on 01.03.2007. Amar and Akbar are active partners, while Anthony is a sleeping partner.Q.Is the Partnership firm valid?a)No, as the agreement was not a written one.b)No, as Akbar is not participating.c)No, as the firm has not been registered.d)Yes, because they agree to share profits.Correct answer is option 'D'. Can you explain this answer?
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Amar, Akbar and Anthony jointly started business of supplying cottons and agreed to share profits equally through oral agreement on 01.03.2007. Amar and Akbar are active partners, while Anthony is a sleeping partner.Q.Is the Partnership firm valid?a)No, as the agreement was not a written one.b)No, as Akbar is not participating.c)No, as the firm has not been registered.d)Yes, because they agree to share profits.Correct answer is option 'D'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Amar, Akbar and Anthony jointly started business of supplying cottons and agreed to share profits equally through oral agreement on 01.03.2007. Amar and Akbar are active partners, while Anthony is a sleeping partner.Q.Is the Partnership firm valid?a)No, as the agreement was not a written one.b)No, as Akbar is not participating.c)No, as the firm has not been registered.d)Yes, because they agree to share profits.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Amar, Akbar and Anthony jointly started business of supplying cottons and agreed to share profits equally through oral agreement on 01.03.2007. Amar and Akbar are active partners, while Anthony is a sleeping partner.Q.Is the Partnership firm valid?a)No, as the agreement was not a written one.b)No, as Akbar is not participating.c)No, as the firm has not been registered.d)Yes, because they agree to share profits.Correct answer is option 'D'. Can you explain this answer?.
Amar, Akbar and Anthony jointly started business of supplying cottons and agreed to share profits equally through oral agreement on 01.03.2007. Amar and Akbar are active partners, while Anthony is a sleeping partner.Q.Is the Partnership firm valid?a)No, as the agreement was not a written one.b)No, as Akbar is not participating.c)No, as the firm has not been registered.d)Yes, because they agree to share profits.Correct answer is option 'D'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Amar, Akbar and Anthony jointly started business of supplying cottons and agreed to share profits equally through oral agreement on 01.03.2007. Amar and Akbar are active partners, while Anthony is a sleeping partner.Q.Is the Partnership firm valid?a)No, as the agreement was not a written one.b)No, as Akbar is not participating.c)No, as the firm has not been registered.d)Yes, because they agree to share profits.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Amar, Akbar and Anthony jointly started business of supplying cottons and agreed to share profits equally through oral agreement on 01.03.2007. Amar and Akbar are active partners, while Anthony is a sleeping partner.Q.Is the Partnership firm valid?a)No, as the agreement was not a written one.b)No, as Akbar is not participating.c)No, as the firm has not been registered.d)Yes, because they agree to share profits.Correct answer is option 'D'. Can you explain this answer?.
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