Formation of a Partnership
What is a partnership?
What is are the Articles of Co-
Partnership?
What are the principals in the
agreements?
What are the characteristics of a
Partnership?
What does it mean a partnership has to mutual agreement, may be written or oral
be "based on contract?
What does "voluntary association"
mean?
A business owned by two or more
individuals
A written agreement the partners
governing the nature and terms of the
partnership contract
1. Name of the Partnership
2. The names addresses of the partners
3. Effective date of the contract
4. Purpose and principle place of
business
5. The Investments each partner will make
in the business
6. Rights and duties of each partners
7. Allocation and distribution of
profit/losses
8. Conditions under which the partners
may withdraw money / assets
9. Manner of keeping the books of
accounts
10. method of decision making
1. Based on contract
2. Voluntary association
3. Mutual agency
4. Limited life
5. Unlimited Liability
6. Co-ownership of Property
7. Co-ownership of Profit
8. Legal Entity
9. Income Tax
no one is forced
What is the definition of "mutual
agency"?
What does "limited life" characteristic
mean?
What does it mean to have "unlimited
liability"?
What does "co-ownership of property"
mean?
What does "co-ownership of profit"
mean?
What is a "legal entity"?
What does income tax have to
contribute to the partnership?
What are the advantages of a
partnership?
What are the disadvantages of a
partnership?
What are the different kinds of
partnerships according to activities?
partner may act as an agent in conducting
its affairs
may be dissolved by actions of the
partners or by operation of law, any
change/incapicity in partnership will
dissolve the partnership
the personal assets of a general partner
may be used to pay for the claims of the
creditors if the partnership assets are not
enough to pay for the company's liabilities
properties contributed to the partnership
are owned by the partnership, not
personal property anymore
a partner has the right to share in
partnership profits as a return of their
investment
a partnership has a legal personality
separate and distinct from that of each of
the partners
Partnerships are subject to income tax
rate of 30% beginning the fiscal year with
the exception of general professional
partnerships
- it is easy and inexpensive to
form/dissolve
- greater amount of capital can be raised
- relative freedom/flexibility in decision-
making
- better managed because more than one
person supervises the business
- unlimited liability of general partners
make it lesk risky for the creditors
- lack of business continuity
- limited amount of capital
- general partner may subjected to
personal liability
- likelihood of disagreement
- difficulty in transferring ownership
Service, Merchandising/Trading,
Manufacturing
What is a service partnership?
What is a merchandising/trading
partnership?
What is a manufacturing partnership?
What are the different kinds of
partnerships according to liability?
What is a general partnership?
What is a limited partnership?
What are the different kinds of
partnerships according to object?
What is a universal partnership of all
present property?
What is a universal partnership of
profits?
What is a particular partnership?
What are the different kinds of
partnerships according to duration of
partnership existence?
What is a partnership at will?
What is a partnership with fixed term?
What are the kinds of partners
according to contribution?
What is a capitalist partner?
What is an industrial partner?
What is an capitalist-industrial partner? one who contributes money, property and
What are the kinds of partners
according to liability?
main activity is the rendering of services
main activity is the purchase or sale of
goods
main activity is the production of goods
General and Limited
all partners are general partners who are
liable for the partnership debts to the
exten of their personal property after all
the partnership assets have been
exhausted
one consisting of one or more general
partners and one or more limited partners
Universal partnership of all present
property, universal partnership of profits,
particular partnership
all partners contribute to the property
which actually belong to each of them
one which all partners may acquire the
movable/immovable proeperty and does
not become common partnership assets
related to the exercise of profession, no
personal assets
Partnership at will, Partnership with fixed
term
no term is specified, terminated anytime
by mutual agreement or by will
one in which the term/period for which the
partnership is to exist is agreed upon
capitalist, industrial, capitalist-industrial
one who contributes capital in money or
property
one who contributes industry, labor, skill
or service
industry
general, limited
What is a general partner?
What is a limited partner?
What are the kinds of partners
according to management?
What is a managing partner?
What is a silent partner?
What is a nominal partner?
What is a secret partner?
What is a dormant partner?
one whose liability to third persons
extends to his private property
one whose liability to third persons is
limited only to the extent of his capital
contribution to the partnership
managing partner, silent partner, nominal
partner, secret partner, dormant partner
one who manages actively the business of
the partnership
one that provides capital to the
partnership but generally does not
participate in management
a partner in name only
one who takes active part in the business
but connection with partnernship is
concealed/unkown to the public
one who does not take active part in the
business and is not known to the public
as a partner