Nature of partnership

NATURE OF PARTNERSHIP

Partnership:

Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all.

Essential elements of partnership:

1.association of two or more persons: there should be at least two competent persons to firm a partnership. As regards the maximum number of partners in a firm.

2.agreement: the partnership relation is one of contractual nature it arises from contract and not from status agreement between the partners is the basis of the contract.the agreement may be express or implied contract.

3.business: a partnership can be formed only for the purpose of the carriying some business.are the profession.

4.sharing a business:the objectect of partnership must be to make profit. Profit means net profit,profits must be distributed among the partners in an agreed ratio.