Q.2:- For which of the following types of business do you think a partnership form of organization would be more suitable and why? (a) Grocery store (b) Medical store (c) Legal consultancy (d) Craft centre (e) Internet cafe (f) Chartered accountancy firm
Partnership form of organization would be most suitable for an Internet cafe as this business needs greater capital investment and varied skills. It can come into existence easily through a legal agreement by putting an agreement between the prospective partners into place whereby they agree to carry out the business of the firm and share risks. There is no compulsion with respect to registration of the firm. In case of lack of demand closure of the firm too is not difficult. Further the partners are jointly and individually liable for payment of debts which does not put the liability on one person as in sole proprietorship.