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Question
Distinguish between the following.
Sole Trading concern and partnership firm.
Solution
| Basis of Difference |
Sole Trading Concern | Partnership Firm |
| Formation | Formed at the will of the owner. |
Formed with a mutual agreement (oral or written) among the partners. |
| Management and control |
Managed and controlled solely by the owner. |
Management and control of ownership are shared by the partners. |
| Sharing of profits and losses |
Profits and losses belong to the owner. |
Profits and losses are shared among the partners in a predecided ratio. |
| Number of members | Only one member (owner) runs it. |
Minimum-2, Maximum (in case of a banking business)- 10, Maximum (in case of ordinary business)- 20. |
| Governance | There is no regulating act to govern it. |
It is governed by the Indian Partnership Act 1932. |
| Decision making | Decision making is rapid, as all the decisions are taken by the sole proprietor. |
Decision making is relatively delayed, as it requires the consent of all partners. |
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RELATED QUESTIONS
| Group'A' | Group 'B' | ||
| a | Sole trader | 1 | Insurable interest |
| b | Life insurance | 2 | Branch of Social Science |
| c | Business ethics | 3 | Local market |
| d | Henry Fayol | 4 | Father of scientific management |
| e |
Planning |
5 | Principle of indemnity |
| 6 | Father of modern management | ||
| 7 | Primary function of management | ||
| 8 | To earn profit | ||
| 9 | Last function of management | ||
| 10 | National market |
Features of sole trading concern.
Sole Trading Concern and Partnership Firm
Sole Trading Concern and Partnership
Select the proper option from the options given below and rewrite the completed sentence.
A sole proprietorship has ________ owner/owners.
Select the proper option from the options given below and rewrite the completed sentence.
A sole trading concern ensures ________ business secrecy.
Match the correct pairs.
Write a word or a phrase or a term which can substitute the following.
The owner is the sole manager and decision maker of his business.
Write a word or a phrase or a term which can substitute the following.
An artificial person created by law.
Write short notes on the following.
Features of a proprietorship
State Whether the Following Statement Is True Or False (Give Reason).
A sole trader can take prompt decisions and quick actions.
State Whether the Following Statement Are True Or False (Give Reason)
Sole Trading Concern is convenient and suitable when the market of goods is local.
Kiran is a sole proprietor. Over the past decade, her business has grown from operating a neighbourhood corner shop selling accessories such as artificial jewellery, bags, hair clips and nail art to a retail chain with three branches in the city. Although she looks after the varied functions in all the branches, she is wondering whether she should form a company to better manage the business. She also has plans to open branches countrywide.
(a) Explain two benefits of remaining a sole proprietor
(b) Explain two benefits of converting to a joint stock company
(c) What role will her decision to go nationwide play in her choice of form of the organisation?
(d) What legal formalities will she have to undergo to operate business as a company?
The structure in which there is a separation of ownership and management is called
The Karta in Joint Hindu family business has
The Head of the joint Hindu family business is called
Define the following business entities:
Sole Proprietorship
