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CCP104

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The document summarizes the key differences between sole trading and partnership forms of business organization. It notes that sole trading involves only one person who has unlimited liability, while partnership requires a minimum of two persons and a maximum of ten for banking or twenty for other businesses. Partnership firms are regulated by the Partnership Act of 1932, require an agreement between partners, and decisions require consultation between multiple individuals. The document lists ten specific points of distinction between sole trading and partnership businesses, such as the ability to introduce division of labor, maintain trade secrets, secure larger capital, and how business losses and dissolution are handled.

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CCP104

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69 views20 pages
The document summarizes the key differences between sole trading and partnership forms of business organization. It notes that sole trading involves only one person who has unlimited liability, while partnership requires a minimum of two persons and a maximum of ten for banking or twenty for other businesses. Partnership firms are regulated by the Partnership Act of 1932, require an agreement between partners, and decisions require consultation between multiple individuals. The document lists ten specific points of distinction between sole trading and partnership businesses, such as the ability to introduce division of labor, maintain trade secrets, secure larger capital, and how business losses and dissolution are handled.

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The document summarizes the key differences between sole trading and partnership forms of business organization. It notes that sole trading involves only one person who has unlimited liability, while partnership requires a minimum of two persons and a maximum of ten for banking or twenty for other businesses. Partnership firms are regulated by the Partnership Act of 1932, require an agreement between partners, and decisions require consultation between multiple individuals. The document lists ten specific points of distinction between sole trading and partnership businesses, such as the ability to introduce division of labor, maintain trade secrets, secure larger capital, and how business losses and dissolution are handled.

Copyright:

Attribution Non-Commercial (BY-NC)
Download as PPT, PDF, TXT or read online from Scribd
Download as ppt, pdf, or txt
69 views20 pages

CCP104

Uploaded by

api-3849444
The document summarizes the key differences between sole trading and partnership forms of business organization. It notes that sole trading involves only one person who has unlimited liability, while partnership requires a minimum of two persons and a maximum of ten for banking or twenty for other businesses. Partnership firms are regulated by the Partnership Act of 1932, require an agreement between partners, and decisions require consultation between multiple individuals. The document lists ten specific points of distinction between sole trading and partnership businesses, such as the ability to introduce division of labor, maintain trade secrets, secure larger capital, and how business losses and dissolution are handled.

Copyright:

Attribution Non-Commercial (BY-NC)
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You are on page 1/ 20

DEPARTMENT OF TECHNICAL EDUCATION

ANDHRA PRADESH

Name : R.Dasharatham
Designation : Lecturer
Branch : D.C.C.P.
Institute : GPW, Warangal
Year : I year
Subject : Business Organization
Subject code : CCP-104
Topic : Forms of Business Organization-Sole
Trading and Partnership
Duration : 50 mts
Sub topic : Distinction between sole trading
and partnership
Teaching Aids: :P.P.T., Animation, Photos.
CCP104.25 11
Objectives
On the completion of this period you would
be able to :

 Distinguish between Sole Trading and


Partnership

CCP104.25 2
Recap

In the previous class, we have discussed


about the
 Dissolution of Partnership
 Dissolution of Partnership Firm

CCP104.25 3
Distinction Between Sole Trading
And Partnership

There are several differences between the Sole


trading and the Partnership.
They are as follows :

CCP104.25 4
1. Minimum Number Of Persons

sole trading partnership

 Only one person required  Minimum two members


to form  Maximum no is Ten in
 no minimum or case of Banking and
maximum limit for Twenty in case of general
number of members Business

CCP104.25 5
2. Act applies

Sole trading Partnership

 No special Act to regulate


 Regulated by the
Partnership Act,
1932

CCP104.25 6
3. Agreement

Sole trading Partnership

 No agreement, as there is
 There must be an
only one member
agreement among the
partners

CCP104.25 7
4. Trade Secrets

Sole trading Partnership

 Can be maintained easily  Cannot be maintained

CCP104.25 8
5.Business Decisions

Sole trading Partnership


Partnership

 Single man’s decision  Decision of more than


 Quick decisions one individual
 Delay in decisions

CCP104.25 9
6. Capital and Scope of Business

Sole trading Partnership


 cannot secure large capital
 can secure large capital
 scope of expansion is
limited  the firm can be
expanded

CCP104.25 10
7. Division of Labour

Sole trading Partnership

 cannot be introduced
 can be introduced
 person looks after the  two or more persons look
affairs of the business after the affairs of the
business

CCP104.25 11
8. Quick Decisions

Sole trading Partnership

 can be taken
 not possible to take quick
 need not consult decisions
anybody  partners have to consult
one another

CCP104.25 12
9. Liability and conflicts

Sole trading Partnership


 The Liability of sole  The liability of the partner is
trader is unlimited unlimited, joint and several

 Possibility of conflict
 no possibility for conflict between the partners
as there is only one
person

CCP104.25 13
10. Business losses & Dissolution

Sole trading Partnership


 All business losses  borne by all partners
borne by only one according to their profit
sharing ratio.
person.
 The business cannot end
 The business comes to after the death or retirement
an end with death, of a partner.
insolvency or lunacy of
the sole trader..

CCP104.25 14
Summary
We have discussed about:
 Distinction between Sole Trading and Partnership

CCP104.25 15
Quiz:
1. What are the maximum no. of members required
for the formation of partnership on banking:
a)20
b) 15
c) 10
d) 02
Ans:a

CCP104.25 16
Contd…

Quiz:
2. Trade secrecy will be maintained in case of:

a) Partnership business
b) Sole trading
Ans:b

CCP104.25 17
Frequently asked questions
1. List out any four differences between the Sole
trading proprietorship and the partnership?

2. Explain the differences between the sole trading


and partnership?

CCP104.25 18
Assignment
1. Distinguish between the Sole Trading and the
Partnership businesses?

2. What are the features of Sole Trading?

3. What are the features of Partnership firm?

CCP104.25 19
CCP104.25 20

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