Question

Explain the establishment of a corporation coming from a partnership formation.

Answer 1

A partnership is an agreement between two or more people, express or implied, to conduct business. The parties to a partnership may be individuals and even other partnerships.The members of a partnership may enter into a written agreement, but it is not mandatory. Generally, to determine whether a partnership exist, there must be sharing of profits and losses, joint administration and control of the business and common ownership of property.

Steps to formation of partnership are :-

• Register the business. You need to register your business with governmental authorities before starting it's operations.
• Naming Partnership. In it the name for our partnership is decided. Name of the partnership is used to get it registered.
• Obtaining Registration. In this step all the formalities with the appropriate authorities are completed.
• Creating Partnership Aggrement. Herein the deed is made among the partners regarding their shares in profits and losses ands capital investments to be brought in by each. How decisions will be made, how partners will divide profits, how you will resolve disputes, how to change ownership, and how to dissolve the partnership are all key points to consider.

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Aditya Aggarwal