Mastergp
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The partnership as we know is a business that involve two to twenty people who agree legally to set up and manage a business outfit with the sole aim of making profit and the result of their agreement are called partners and they share the profit, losses and risk of the business.
There are some advantages that come from partnership they include:
Sufficient capital:
Partnership has more financial resources than a sole proprietorship because more people are involved, hence more capital can be raised through partner's contribution.
There is privacy : in this kind of business unit, there is privacy because partners are not legally compelled to publish the annual accounts for public consumption.
Better management:
By combining skill and abilities, partnership business are usually better managed than a one man business
Specialisation in management:
The principle of division of labour can be applied in the managerial and administrative hierarchy of the business. For example, in an accounting firm, some accountants may be management accountant while others may specialise.
Greater possibility of expansion:
There is the possibility of expansion, by making use of additional capital derived from in coming partners.
Loan facilities:
A partnership can easily obtain loan from creditors since they are jointly liable. The loan can be used for expansion of the business.
There are some advantages that come from partnership they include:
Sufficient capital:
Partnership has more financial resources than a sole proprietorship because more people are involved, hence more capital can be raised through partner's contribution.
There is privacy : in this kind of business unit, there is privacy because partners are not legally compelled to publish the annual accounts for public consumption.
Better management:
By combining skill and abilities, partnership business are usually better managed than a one man business
Specialisation in management:
The principle of division of labour can be applied in the managerial and administrative hierarchy of the business. For example, in an accounting firm, some accountants may be management accountant while others may specialise.
Greater possibility of expansion:
There is the possibility of expansion, by making use of additional capital derived from in coming partners.
Loan facilities:
A partnership can easily obtain loan from creditors since they are jointly liable. The loan can be used for expansion of the business.
