Explain the following terms/concepts
1) Sole Trading Concern.
(i) It is a form of business organization which is owned, managed and controlled by one person.
(ii) It need not be registered.
(iii) It does not have a legal status i.e. It does not have a stable life.
(iv) Maximum secrecy can be maintained in Sole Trading concern.
2) Partnership Firm.
(i) It Is a voluntary association of two or more persons With a common objective.
(ii) It is formed by an agreement called Partnership deed.
(iii) It is governed by Indian Partnership Act, 1932.
(iv) Registration of partnership firm Is optional as per Partnership Act, 1932.
(v) in Maharashtra, registration of partnership firm is made compulsory.
3) Joint Hindu Family Firm.
(i) It is a form of business organization which is carried from one generation to another generation.
(ii) It comes into existence by operation of Hindu Law.
(iii) This form organization Is found in India only.
(iv) The senior most member of the family Is called ‘Karta’ while other members are called ‘Co-parceners’.
4) Co-operative Society.
(i) It is a voluntary association of individuals which Is formed for providing services to members.
(ii) Its main motto is ‘service’ rather than ‘profit’.
(iii) It runs on principle of ‘One member One Vote’.
(iv) It enjoys an independent legal status, distinct from Its members.
5) Joint Stock Company
(i) It is an Incorporated association created by law, having an independent legal status, owned by shareholders and managed by Board of Directors.
(ii) The main motive of Joint Stock company is maximisation of profit.
(iii) It works as principle of “One share one vote”.
(iv) It has to follow Indian Companies Act, 2013.
(i) Karta is a senior most member of the family, who runs the Joint Hindu Family Business.
(ii) The Karta has unlimited liability in such type of business.
(iii) Karta has the right to manage the business.
(iv) Karta need not consult anybody about business decisions.
7) Managing Committee.
(i) Managing committee is a group of members of a Co-operative society, who looks after the working of Co-operative society.
(ii) They are elected by the shareholders of Co-operative society.
(iii) All important decisions are taken by the managing committee.
(iv) In short, they look after day to day administration of the society.
8) Nominal Partner.
(i) A partner who only lends his name and reputation to the partnership firm is called as nominal partner.
(ii) He is simply obliging his friends by allowing the firm to use his name as a partner.
(iii) He may or may not be given any share in the profits of the firm.
(iv) He does not contribute to the capital of the business.
(v) He is liable to the debts of the firm.