Analyzing the Use of Business Concepts in Partnerships

Description and Definition of Concept 1:

In this assignment, you will choose three concepts from the textbook and provide a further analysis and research on how they are used in business. Format: ?

Your report should be structured as: I. Introduction II. Description and Definition of Concept 1: III. Description and Definition of Concept 2: IV. Description and Definition of Concept 3: V. An Analysis of How Each Concept is Used in Business VI. Conclusion VII. References Your report should be supported through APA (in-text citations and references) throughout. Apart from the textbook, please use a minimum of 5 additional external academic sources to support your academic work.

 

Any time two people must agree, conflict and tension are possible. Partnerships have caused splits between relatives, friends, and spouses. Let’s explore the disadvantages of partnerships next.
1. Unlimited liability. Each general partner is liable for the debts of the firm, no matter who was responsible for causing those debts. You are liable for your partners’ mistakes as well as your own. Like sole proprietors, general partners can lose their homes, cars, and everything else they own if the business loses a lawsuit or goes bankrupt. Third Pass
2. Division of profits. Sharing risk means sharing profits, and that can cause conflicts. There is no set system for dividing profits in a partnership, and they are not always divided evenly. For example, if one partner puts in more money and the other puts in more hours, each may feel justified in asking for a bigger share of the profits.
3. Disagreements among partners. Disagreements over money are just one example of potential conflict in a partnership. Who has final authority over employees? Who works what hours? What if one partner wants to buy expensive equipment for the firm and the other partner disagrees? All terms of the partnership should be spelled out in.
4. Difficulty of termination. Once you have committed yourself to a partnership, it is not easy to get out of it. Sure, you can just quit. However, questions about who gets what and what happens next are often very difficult to resolve when the partnership ends. Surprisingly, law firms often have faulty partnership agreements (legal documents that specify the rights and responsibilities of each partner) and find that breaking up is hard to do. How do you get rid of a partner you do not like? It is best to decide such questions up-front in the partnership agreement. In the absence of an agreement, or if certain provisions are not addressed in the agreement, provincial or territorial laws will determine some or all of the terms of the partnership.
5. Possibly pay higher taxes. Similar to a sole proprietorship, if the partnership is very profitable, it may be paying higher taxes than if it was incorporated as a CCPC.14 The best way to learn about the advantages and disadvantages of partnerships is to interview several people who have experience with such arrangements. They will give you insights and hints on how to avoid problems. The Making Ethical Decisions box leaves you with a dilemma to consider when it comes to making decisions in a partnership.