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Commerce Exam  >  Commerce Notes  >  Crash Course of Accountancy - Class 12  >  Introduction of Partnership

Introduction of Partnership | Crash Course of Accountancy - Class 12 - Commerce PDF Download

Meaning of partnership 
When two or more persons join hands to set up a business and share its profits and losses, they are said to be in partnership. 

Definition of partnership 
‘Relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all’. 

Essential features of partnership are 
1. Two or More Persons – minimum member 2  
2. Agreement- oral or written
3. Unlimited Liability of Partnership
4. Sharing of Profit
5. Mutual Agency - business of a partnership concern may be carried on by all the partners or any of them acting for all
6. Business The agreement should be to carry on some business on regular business.

Partnership Act does not specify the maximum number of persons, but the Section 464 of Indian Companies Act, 2013, restricts the number of partners to 50. 


Rights of a Partner 
1.  Every partner has the right to share profits or losses with other partners in the agreed ratio.  
2.  Every partner has the right to take part in the conduct of the business.  
3.  Every partner has the right to be consulted in the matters related to partnership business.  
4.  Every partner has the right to inspect and have a copy of the books of accounts.  
5.  Every partner has a right to disallow the admission of a new partner.  
6.  Every partner is the joint owner of the partnership property.  
7.  If a partner has given loan to the firm, he has a right to receive interest at agreed rate. If the rate of interest is not agreed, it is paid @6% p.a.  
8.  If a partner incurs expenses or makes payment on behalf of the firm, he has a right to be indemnified by the firm.  
9.  Every partner has a right to retire from the firm after giving a proper notice.

Limited liability Partnership (LLP) 
The limited liability partnership (LLPs) in India came into existence with the enactment of ‘limited liability partnership act 2008’ which lay down the law for the formation and regulation of limited liability partnerships.

Definition
The limited liability partnership (LLPs) means a partnership formed and registered under this act. 


Nature of limited liability partnership (LLPs) 
I. A LLP is s body, formed and incorporated under this act.
II. It is legal entity separate from its partners.
III. A LLP shall have a perpetual succession 

Partnership Act does not specify the maximum number of persons, but the Section 464 of Indian Companies Act, 2013, restricts the number of partners to 50.

Difference between ordinary partnership and LLP 

S.NO.
BASIS
Partnership
LLP
1.Applicable law
Partnership act 1932
LLP ACT,2008
2.Registration
Optional
Mandatory but with the registrar of companies
3.Creation
By agreement
By Law
4.Separate legal  Entity
Entity It is not a Separate legal
It is not a Separate legal Entity
5.Perpetual succession
A partnership doesn’t have a Perpetual succession
A LLP shall have a perpetual succession
6.Number of members
Minimum 2 & maximum 50
Minimum 2 & maximum no limit


 

The document Introduction of Partnership | Crash Course of Accountancy - Class 12 - Commerce is a part of the Commerce Course Crash Course of Accountancy - Class 12.
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FAQs on Introduction of Partnership - Crash Course of Accountancy - Class 12 - Commerce

1. What is partnership commerce?
Ans. Partnership commerce refers to a business model where two or more companies collaborate to promote and sell products or services to their respective customer bases. It involves sharing resources, marketing efforts, and revenue in order to mutually benefit from the partnership.
2. How does partnership commerce work?
Ans. Partnership commerce works by forming strategic alliances between companies that have complementary products or services. They establish a partnership agreement, define their roles and responsibilities, and collaborate on marketing and sales activities. This can include joint product promotions, cross-selling, co-branded campaigns, or referral programs.
3. What are the benefits of partnership commerce?
Ans. Partnership commerce offers several benefits, such as expanding market reach by accessing new customer segments, leveraging each other's brand reputation, pooling resources and expertise, reducing costs through shared marketing efforts, and increasing revenue through cross-selling or upselling opportunities.
4. How can companies form successful partnership commerce?
Ans. Companies can form successful partnership commerce by carefully selecting partners that align with their target market and have complementary products or services. It is crucial to establish clear communication channels, define goals and expectations, and create a comprehensive partnership agreement that outlines the responsibilities and benefits for each party involved.
5. What are some examples of partnership commerce?
Ans. Examples of partnership commerce include collaborations between technology companies and retailers, such as Apple partnering with various retail chains to sell its products, or partnerships between airline companies and credit card companies to offer co-branded credit cards with travel benefits. Another example is a clothing brand partnering with a popular influencer to create a limited-edition collection.
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Document Description: Introduction of Partnership for Commerce 2024 is part of Crash Course of Accountancy - Class 12 preparation. The notes and questions for Introduction of Partnership have been prepared according to the Commerce exam syllabus. Information about Introduction of Partnership covers topics like and Introduction of Partnership Example, for Commerce 2024 Exam. Find important definitions, questions, notes, meanings, examples, exercises and tests below for Introduction of Partnership.
Introduction of Introduction of Partnership in English is available as part of our Crash Course of Accountancy - Class 12 for Commerce & Introduction of Partnership in Hindi for Crash Course of Accountancy - Class 12 course. Download more important topics related with notes, lectures and mock test series for Commerce Exam by signing up for free. Commerce: Introduction of Partnership | Crash Course of Accountancy - Class 12 - Commerce
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