Difference between Sole Proprietorship, Partnership & Joint Stock Company

Difference between Sole Proprietorship, Partnership & Joint Stock Company

1. DIFFERENCE BETWEEN
SOLE PROPRIETORSHIP,
PARTNERSHIP &
JOINT STOCK COMPANY
Compiled By:-
Dharti Shah (46)
Dhrumil Shah (47)
Kavisha Shah (48)
Param Shah (49)
Shairavi Shah(50)

2. CONTENTS
Sole Proprietorship
Features of Sole Proprietorship
Partnership
Features of Partnership
Joint Stock Company
Features of Joint Stock Company
Difference
Examples for forms of organizations
Bibliography
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3. SOLE PROPRIETORSHIP
The sole proprietor is an unincorporated business with
one owner who has unlimited liability & is the sole
recipient of the profit or loss incurred by the firm.
It is the simplest form of business with least
government intervention. This is because of the fact
that it is not a legal entity.
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4. FEATURES OF SOLE
PROPRIETORSHIP
•Unlimited liability
•No government intervention
•Quick decision making
•Flexible
•Single handed
•Secrecy maintained
•Sole receiver of profit/loss(if any)
•Can be operated from home
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5. PARTNERSHIP
Section 4 of the Indian Partnership Act, 1932 defines
Partnership as the relation between persons who have
agreed to share the profits of the business carried on by
all or anyone of them working for all. The minimum
members in a partnership firm are 2 and maximum
10(Banking) & 20(General).
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6. FEATURES OF PARTNERSHIP
Sufficient Capital
Divided liability
Risk sharing
Profit distributed
Easy expansion
Specialized skills present
Profit motive
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7. JOINT STOCK COMPANY
A Joint Stock Company has to go through a series of
steps before it commences, viz., Formation,
Incorporation, Capital Subscription & Commencement
of Business.
In case of public company, it has to complete all the
four stages whereas in case of private company, it can
start with its operations after the incorporation stage.
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8. FEATURES OF JOINT STOCK
COMPANY
Artificial person
Separate legal entity
Limited liability of members
Perpetual existence
Common seal
Risk bearings
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9. DIFFERENCE
Basis
Sole
Proprietorship
Partnership
Joint Stock
Company
Formation
Minimal Legal
Formalities,
easiest formation
Registration is
optional, easy
formation
Registration
compulsory,
lengthy and
expensive
formation process
Members Single owner
Minimum- 2
Maximum :
(Banking- 10
Others- 20)
Minimum
Private- 2
Public Company-
7
Private Company-
50
Public Company-
unlimited
Capital
Contribution
Limited financeLimited but more
Large financial
Resources
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10. Basis
Sole
Proprietorship
Partnership
Joint Stock
Company
Liability Unlimited
Unlimited and
joint
Limited
Control and
Management
Owner takes all
decisions, quick
decision making
Partners takes
decision, consent
of all partners is
needed
Separation
between
ownership and
management
Continuity
Unstable,
business and
owner regarded
as one
More stable but
affected by status
of partners
Stable because of
separate legal
status

11. EXAMPLES FOR FORMS OF
ORGANIZATIONS
Sole Proprietorship- Ashoka, Gandevikar
Jewellers, C H Jewellers,
Partnership- Neptune Trading Company
Joint Stock Company- Reliance Industries Pvt.
Ltd., TATA, BSNL
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12. BIBLIOGRAPHY
Wikipedia.org
Entrepreneur.com
Investopedia.com
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