What are the features of partnership?

• An association between two or more persons who
• carry on a business as partners
• share profits or losses according to partnership agreement
• Enables sharing of ideas, skills and resources
• Easy and cheap to establish
• Includes details of the partnership
• Name of partnership
• Partner contributions of cash and other assets
• Profit and loss sharing ratios
• Entry and exit information

What are the advantages of partnership?

• Relatively easy and simple to set up
• Informal business structure – not
  bound by accounting standards
• Ability to share capital, skills, talents, knowledge and workload between two or more people

What are the disadvantages of partnership?

• Unlimited liability for business debts and obligations by all partners
• Limited life – if one partner dies or withdraws from the business then the partnership must dissolve
• Mutual agency – each partner is seen as being an agent for the business and so is bound by any partnership contract

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