Commercial Applications
Answer
| S.No. | Basis of Distinction | Sole Proprietorship | Partnership |
|---|---|---|---|
| 1. | Number of owners | One person. | Minimum: 2, Maximum: 50. |
| 2. | Agreement | No agreement is required. | Agreement is essential. |
| 3. | Division of profits/loss | No division of profit and no sharing of risk. | Division among the partners in agreed ratio. |
| 4. | Implied agency | No implied agency. | Generally every partner is an implied agent of the firm. |
| 5. | Ownership and control | Not shared. | Shared by partners. |
| 6. | Secrecy | Complete secrecy. | Secrets known to partners. |
| 7. | Continuity of business | Life of business depends on proprietor. | Greater continuity due to two or more partners. |
| 8. | Coordination | No problem of coordination due to single owner. | Coordination between partners required. |
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