PARTNERSHIPS

                                                 PARTNERSHIPS

          When two or more people come together to start a business , they are said to enter into a partnership. The money invested by   them is called capital invested and the period for which it is investedIs the investment duration. Typically, there are two schemes in which the partners share their profit/loss.

 SCHEME 1:profit/loss is divided in the ratio of the product of capital   invested and investment period.

SCHEME 2: one or more partners are working and others are not working , and the working partners gat a pay(fixed pay as a salary or variable pay as share of profit) in addition to their share of profit based on capital and investment period.

                                            REMEMBER

               Profit/loss share is not just a function of the capital invested but also of the time period for which it is invested.