Write short notes on the following.
Merits of a partnership firm
Merits of a partnership firm
Merits of a partnership firm:
i. Easy formation: It requires an agreement (oral or written) between two or more partners for its formation. Thus, easy formation.
ii. Sharing of risks: The risks in a partnership firm are shared jointly by all partners. This reduces the burden on each partner.
iii. Balanced decision making: Decision making is balanced, as all decisions are taken collectively by all partners.
iv. Confidentiality: As a partnership firm is not required to publish its accounts or submit its reports legally, confidentiality and secrecy of information are maintained.
v. Greater flexibility: A partnership firm enjoys greater flexibility because not many restrictions are there under the Partnership Act.
vi. Greater availability of resources: As partners pool their capital and resources, the business gets higher amount of funds for its operations.
i. Easy formation: It requires an agreement (oral or written) between two or more partners for its formation. Thus, easy formation.
ii. Sharing of risks: The risks in a partnership firm are shared jointly by all partners. This reduces the burden on each partner.
iii. Balanced decision making: Decision making is balanced, as all decisions are taken collectively by all partners.
iv. Confidentiality: As a partnership firm is not required to publish its accounts or submit its reports legally, confidentiality and secrecy of information are maintained.
v. Greater flexibility: A partnership firm enjoys greater flexibility because not many restrictions are there under the Partnership Act.
vi. Greater availability of resources: As partners pool their capital and resources, the business gets higher amount of funds for its operations.
