graham has decided to open the shop.in making this decision, analyse way he should form a partnership with Jim(6 marks)
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Answer:
What a Partnership Means
A partnership is a business organization with two or more persons as owners. Partnerships are governed by state laws, and a new partnership is registered with the state where it will be doing business.
Each partner shares in the organization's profits (and losses) and may share in the business operations decisions. 1
For tax purposes, the partners are taxed, not the business itself. That is, the partners pay their share of the taxes based on their share of the partnership, through their personal tax returns2.1
Before You Go Into a Partnership
Before you decide on who will join you in a partnership, you should check out these potential partners. Even if you have known someone from kindergarten, it's a good idea to make sure they are good partner material. That means, for each potential partner:
Doing a credit check on each partner. Use one or more of the credit agencies (Experian, Equifax, or TransUnion) to run a credit check