Question

what is a dormant partner​

Answer 1

Hey friend, your required answer is:

Contributor or investor who is not active in managing a firm and may not be known to the outsiders. A dormant partner shares profits and losses with other partners but (if he or she is not a signatory to the loan agreements) generally may withdraw from the firm without notice to the lenders.

Answer 2

Dormant partner is described below:

Dormant partner:- A partner who is not involved in the day-to-day operations of a firm or partnership but is nonetheless entitled to a profit- and loss-sharing portion of the partnership's net income.

• A sleeping partner or silent partner is another name for this person. This type of partner does not participate in the day-to-day operations of a firm or partnership, but they are still entitled to a portion of the profits and are also responsible for a portion of the losses.
• Like every other partner, he will continue to contribute his fair amount of capital, as well as partake in the firm's gains and losses.
• The actions of all the other partners, however, bind him. A partnership is when two or more people collaborate and split the profits from a business or profession.
• A sleeping partner, also known as a dormant partner, provides the company with merely financial support and has no involvement in decision-making. He is also known as a financing partner or a dormant partner.
• This partner does not actively participate in the everyday operations of the partnership firm, that is, he does not contribute to them.
• Such a dormant partner need not give notice of his retirement to the public. As a result, he will not be held responsible for any actions taken after his retirement.

Hence, this is the Dormant partner.

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