Question

Define sleeping and active partners.

Answer 1

Sleeping Partners : Some partners provide only the finance, but do not take part in the running of the business. Such partners are called sleeping partners.

Active Partners : Active partner is that who not only invests capital but looks after the activities of the business. Active partner always receives profits and a fixed salary for managing the business.

Answer 2

Sleeping Partner :-

A sleeping partner is a person who provides some of the capital for a business but who does not take an active part in managing the business.

Active Partner :-

An active partner is an invested person who is involved in the daily operations of the partnership.