Explain the basic characteristics of a partnership.

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Expert Solution

There must be at least two or more persons to form Partnership.

There must be agreement between partners and such agreement can be Oral or Written. The agreement forms the basis of Mutual rights and duties of Partners.

Partnership can be formed for the purpose of carrying on some business with the intension of earning some profit.

The Agreement must include how the profit or loss to be shared. If the persons joins firm for some Charity then it will not be called partnership and if the persons is deprived of his right to share the profit then he/she will not be called partner. And it is not necessary that all partner share loss also, it may be agreed between partners that some oo one of the partners will not be liable for losses.

All the persons have Unlimited liability i.e. if the assets of the company is not sufficient to pay the liabilities then the Creditors can come after the personal property of the Partners.

In the eyes of Law, A partner and Partnership firm are same, i.e. Partnership firm doesn’t have its own Legal identity.

The business must be Legal.

ekkarill92 answered 1 year ago

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