ABM112 Flashcards
This is characterized by 2+ people binding themselves to contribute money, property, or industry with the intention of dividing profits among each other
Partnership
What is the 1-10 characteristics of a partnership
- Based on Contract
- Association of Individuals
- Ease of formation
- Co ownership
- Assignment of partner’s interest
- Mutual Agency
- Income Participation
- Unlimited Liability
- Limited Life
- Consent
This type of partner contributes money
Capitalist Partner
This type of partner contributes skills
Industrial Partner
This type of partner is the manager of the day to day operations and faces unlimited liability
General Partner
This type of partner only contributes and can only receive profit, but in exchange they can’t manage the partnership and they have limited liability
Limited Partner
What are the 4 kinds of partnerships
- Based on nature
- Based on purpose
- Based on liability
- Based on legality of existence
What are the 2 types of partnership based on nature?
- Trading Partnership
- Service Rental
What are the 2 types of partnership based on purpose?
- Commercial - This one is taxable
- General Professional - This one is not
What are the 2 types of partnership based on Legality of Existance?
- De Jure - In accordance with legal requirements, is fully legally recognized
- De Facto - Is not fully legally recognized or registered.
What are the 2 types of partnership based on liability?
- General - All partners have limited liability, so creditors can go after anyone and everyone
- Limited - There is a general and limited partner and limited partners only invest and are not held personally liable beyond their contribution
This type of partner is one who is actually not a partner but
who represents himself as one.
Nominal Partner/Partner by Estoppel
This type of partner is one who does not take active part in the business of the partnership and is not known as a partner
Dormant partner
This type of partner is one who does not take active part in the business of the partnership though may be known as a partner
Silent Partner
This type of partner is one who takes active part in the business but is not known to be a partner by outside parties.
Secret partner.
Partners may invest cash or non-cash assets in the partnership. When a partner invests cash or non-cash assets, they are to be recorded at what values?
Values agreed upon, but if they cannot agree, then use the fair values of the non cash asset
This type of partner is one who is designated to round up or settle the affairs of the partnership after dissolution.
Liquidating Partner
A partnership may be constituted orally or in writing. In the latter case, partnership agreements are embodied in the?
Articles of Partnership
This is the estimated amount that a willing seller would receive from a financially capable buyer for the sale of the asset in a free market.
Fair Market Value
Assets is = to?
Assets = Liabilities + Owner Equity
If an Industrial Partner only contributes skills, then how will their contributions be recorded?
Their contributions are put in the memorandum entry
