Q. 7. What are the features of Partnership Firm?

Ans: Following are the features of partnership firm:
1) Membership: In partnership minimum membership is two and maximum membership ten for banking business and twenty for non-banking business.
2) Agreement: To start partnership agreement is compulsory. Without agreement partnership cannot be formed. Partnership is formed by two or more persons. Unless these persons agree with each other there cannot be partnership. The agreement may be oral or written. Written agreement is better to avoid conflicts among the partners in future.
3) Lawful business: Partnership must be formed to undertake business. It can do only that business which is permitted by law. It cannot do any illegal business.
4) Joint ownerships: In partnership there is joint ownership. Business properties are owned by all the partners jointly. No partner can use business property for personal use. No partner can make personal profit from the business.
5) Joint management: Partnership business is managed by all the partners jointly. Every partner has a right to take part in the management of business.
6) Sharing of profit and losses: Partnership is started to earn and share profit Partners share prom and loss in their agreed ratio. It is mentioned in the partnership deed If it is not mentioned then partners share profit and loss equally.
7) No separate legal status: Partnership firm does not enjoy separate legal status. As per law Partnership firm and Partners are one and the same. They are not separate from each other The organization and its owners are one and the same.
8} Unlimited liability: The liability of partners is unlimited When business liabilities are more men business assets then partners have to sell their personal property in W business liabilities The law does not make difference between business property and permit! it sporty of partners.
9} Utmost good Faith: Success, survival and growth at partnership depend depend mutual faith and understanding among the partners should be honest to each other. They should disclose business information to each other.
1o} Double relationship: in partnership every partner plays double role. Every partner is principal as well as agent He is principal to outsider and agent to other partner.

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