Question

Following are the differences between partnership & joint venture except __________.

• A. a joint venture is essentially planned for short-term mainly for one contract. However, partnerships are normally undertaken as going concerns and are excepted to last for a very long period.
• B. the persons involved in a joint venture are called co-ventures whereas persons involved in a partnership are called partners.
• C. any specific statute of the government does not govern joint ventures but the Indian Partnership Act, 1932, governs partnerships.
• D. memorandum of understanding is mandatory to be drafted to spell the relationship between the co-ventures whereas the basic relationship between the partners is defined by the partnership deed.

Answer 1

Answer: (D)

memorandum of understanding is mandatory to be drafted to spell the relationship between the co-ventures whereas the basic relationship between the partners is defined by the partnership deed.

Option D is correct.

Parties to a joint venture usually execute an agreement to govern their relationship. This agreement determines their rights and liabilities, obligations, duties, profit/loss sharing ratio, etc. It can even mention the duration of the venture.

These partners function by sharing rights, liabilities, duties, profits and losses with each other. They determine the terms of their partnership firm using an agreement known as a partnership deed.

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