D and J purchased 100 bales of cotton to be sold on Joint Account. The...
Partnership Agreement
The given scenario involves two individuals, D and J, who have purchased 100 bales of cotton to be sold on Joint Account. They have agreed to share profit and losses equally. This indicates that they have entered into a partnership agreement.
Definition of Partnership
A partnership is a form of business organization where two or more individuals come together to carry on a business with a view to earning a profit. The individuals who form a partnership are called partners.
Features of Partnership
• Two or more individuals
• Agreement to carry on a business
• Intention to earn a profit
• Sharing of profits and losses
• Mutual agency
• Unlimited liability
Analysis of the Scenario
In the given scenario, D and J have agreed to share profit and losses equally, which is a key feature of a partnership. This indicates that they have formed a partnership and will be jointly responsible for the profits and losses of the business.
Conclusion
Based on the analysis of the given scenario and the features of a partnership, it can be concluded that D and J are partners in a partnership firm.
D and J purchased 100 bales of cotton to be sold on Joint Account. The...
Because they decide to share their profit and loss equally their is profit sharing ratio between both of them so they are partner