Comparative Analysis of Business Entities: Sole Proprietorship, Partnership, and Joint Stock Company

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DR.D.GNANA RANI SARAL
ASSISTANT PROFESSOR
DEPERTMENT OF ECONOMICS
 
ENTREPRENEURIAL DEVELOPMENT
 
 
DIFFERENCE  BETWEEN SOLE
PROPRIETORSHIP , PARTNERSHIP  &  JOINT
STOCK   COMPANY
 
CONTENTS
 
 
 
 
Sole  Proprietorship
 
 
 
Features of  Sole Proprietorship
 
 
 
Partnership
 
 
 
Features of  Partnership
 
 
 
Joint  Stock Company
 
 
 
 
 
 
 
 
undefined
 
 
 
Features of  Joint Stock Company
 
 
 
Differences
 
 
 
Examples for forms of 
 
organization
 
 
 
Bibliography
 
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.
 
 
 
 
 
 
 
 
 
 
FEATURES OF SOLE PROPRIETORSHIP
 
 
 
Unlimited liability
 
 
 
No government intervention
 
 
 
Quick decision making
 
 
 
Flexible
 
 
 
 
 
 
 
 
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Single handed
 
 
 
Secrecy maintained
 
 
 
Sole receiver of profit / loss (if any)
 
 
 
Can be operated from  home
 
PARTNERSHIP
             
Section  4 of the Indian Partnership Act ,
 
1932 defines Partnership as the relation
 
between presents 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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FEATURES OF PARTNERSHIP
 
 
 
Sufficient Capital
 
 
Divided Liability
 
 
Risk Sharing
 
 
 
 
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Profit distributed
 
 
 
Easy expansion
 
 
 
Specializes skills present
 
 
 
Profit motive
 
 
 
 
 
 
 
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.
 
 
 
 
 
 
 
 
FEATURES OF JOINT
STOCK COMPANY
 
 
 
Artificial person
 
 
 
Separate legal entity
 
 
 
Limited liability of members
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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Perpetual existence
 
 
 
Common seal
 
 
 
Risk bearings
 
 
 
 
 
 
 
 
 
 
 
 
 
                                       
DIFFERENCE
 
EXAMPLES FOR FORMS OF
ORGANISATIONS
 
 
 
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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This detailed content provides an in-depth comparison of sole proprietorship, partnership, and joint stock companies, highlighting their features, differences, and examples. It explains the characteristics of each business structure, such as liability, government intervention, decision-making processes, and profit distribution. Useful for understanding the nuances of different forms of organization in the business world.


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  1. ENTREPRENEURIAL DEVELOPMENT DR.D.GNANA RANI SARAL ASSISTANT PROFESSOR DEPERTMENT OF ECONOMICS

  2. DIFFERENCE BETWEEN SOLE PROPRIETORSHIP , PARTNERSHIP & JOINT STOCK COMPANY

  3. CONTENTS Sole Proprietorship Features of Sole Proprietorship Partnership Features of Partnership Joint Stock Company

  4. Features of Joint Stock Company Differences Examples for forms of organization Bibliography

  5. 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.

  6. FEATURES OF SOLE PROPRIETORSHIP Unlimited liability No government intervention Quick decision making Flexible

  7. Single handed Secrecy maintained Sole receiver of profit / loss (if any) Can be operated from home

  8. PARTNERSHIP Section 4 of the Indian Partnership Act , 1932 defines Partnership as the relation between presents 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)

  9. FEATURES OF PARTNERSHIP Sufficient Capital Divided Liability Risk Sharing

  10. Profit distributed Easy expansion Specializes skills present Profit motive

  11. 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.

  12. FEATURES OF JOINT STOCK COMPANY Artificial person Separate legal entity Limited liability of members

  13. Perpetual existence Common seal Risk bearings

  14. DIFFERENCE BASIS Partnership Joint Stock Company Sole Proprietorship Minimum legal Formalities,easiest formation Registration is optional ,easy formation Regisitration compulsory, lengthy and expensive formation process Formation Minimum Private-2 Public Company-7 Private Company-50 Public Company-unlimited Members Minimum- 2 Maximum: (Banking-10 Others-20) Single owner Capital Contribution Limited finance Limited but more Large financial resources Liability Unlimited Unlimited and joint Limited Owner takes all decisions ,quick decision making Partner takes decision ,consent of all partner is needed Separation between ownership and management Control and Management Continuity Stable because of separate legal status Unstable ,business and owner regarded as one More stable but affected by status of partners

  15. EXAMPLES FOR FORMS OF ORGANISATIONS 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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