Basic Knowledge Of Accounting Terms

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Introduction to Accounting Student Number: 37398 Module Leader: Seun Oluwayi Mrs: Karciny Rajmohan Level: 04 Module Code: PM106 Programme: BSc (Honours)…show more content…
With little government regulation, they are the simplest business to set up or take apart, building them popular among individual self-contractors or business owners. Advantage  Easiest to start  Started capital are low  Least regulated  Single owner will keeps all profits  Taxed once as personal income Limitations There are no limitations we can start within 10 days and also we can close our business anytime without anyone control. Partnership A partnership is legal relationship formed by the agreement between 02 or more people to carry on a business as co-owners. And the profit and loses also will be share between who are they acting as a partners of the business. Advantage  Partnerships are comparatively easy to establish.  With more than one owner, the capability to raise funds may be increased, both because two or more partners may be able to fund more funds and because their borrowing ability may be greater.  Future employees may be attracted to the business if given the encouragement to become a partner.  A partnership may benefit from the combination of complementary skills of two or more people. There is a wider pool of knowledge, skills and contacts.  Partnerships can be cost-effective as each partner specializes in certain aspects of their business.  Partnerships provide moral support and will allow for more creative brainstorming. Limitations  Uncertainty of duration Legally, a partnership firm
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