Articles Of Partnership

AAA

DEFINITION of 'Articles Of Partnership'

A document that formalizes an agreement between parties who want to enter a business arrangement to pool their labor and capital and in which all owners are equally responsible for the company's liabilities and entitled to its assets according to agreed-upon percentages. In addition to being an important legal document, the articles of partnership can be useful in preventing and resolving disagreements among partners since it clarifies the terms of the relationship.

INVESTOPEDIA EXPLAINS 'Articles Of Partnership'

The articles of partnership will typically supply the name of the partnership, its principal place of business, the purpose of the business, term of the partnership, each partner's initial capital contribution, each partner's percentage of interest in the partnership, how profits will be distributed, how the partnership will be managed, how salaries (if any) will be distributed, how and under what conditions partnership rights can be transferred or sold, and other information that is essential to the business arrangement.

RELATED TERMS
  1. Articles Of Incorporation

    A set of documents filed with a government body to legally document ...
  2. Capital

    1) Financial assets or the financial value of assets, such as ...
  3. Silent Partner

    An individual whose involvement in a partnership is limited to ...
  4. Limited Partnership - LP

    Two or more partners united to conduct a business jointly, and ...
  5. Liability

    A company's legal debts or obligations that arise during the ...
  6. Partnership

    A business organization in which two or more individuals manage ...
RELATED FAQS
  1. Are there any practical differences between a wholly owned subsidiary and a regular ...

    There are differences between a wholly owned subsidiary, or a company 100 percent owned by another company, and a regular ... Read Full Answer >>
  2. What's the difference between a financial plan and a financial forecast?

    Selecting the appropriate business structure for a new company can present challenges to an entrepreneur. Considerations ... Read Full Answer >>
  3. Which factors drive the marginal propensity to consume?

    A limited liability company (LLC) is not a separate entity from its business owners but is instead considered a pass-through ... Read Full Answer >>
  4. How can I merge technical analysis and fundamental analysis with quantitative analysis ...

    It is important for a sole proprietor with no employees to register as a limited liability company because an LLC provides ... Read Full Answer >>
  5. What is the difference between a money market fund and a savings account?

    The primary advantages of the Herfindahl-Hirschman Index (HHI) are the simplicity of the calculation necessary to determine ... Read Full Answer >>
  6. How do I calculate the Macaulay duration of a zero-coupon bond in Excel?

    A horizontal integration consists of companies that acquire a similar company in the same industry, while a vertical integration ... Read Full Answer >>
Related Articles
  1. Retirement

    Discover Master Limited Partnerships

    These unique investments provide significant tax advantages.
  2. Personal Finance

    Protect Your Personal Assets

    A family limited partnership (FLP) can go a long way toward securing your family's property.
  3. Options & Futures

    Asset Protection For The Business Owner

    Could incorporating your business help protect it? Find out here.
  4. Entrepreneurship

    What is Unlimited Liability?

    Unlimited liability means that the owners of a business are liable for the entire amount of debt and obligations of that business.
  5. Economics

    What is a Partnership?

    A partnership is an organization where two or more owners operate a business.
  6. Stock Analysis

    What Makes LinnCo Different From MLPs?

    MLPs are some of the favorite investments of dividend investors, as the surge in the energy industry increased the amount of income that MLPs paid out to.
  7. Investing

    What's a Transfer Price?

    A transfer price is what one unit of a business charges another unit of the same business for a good or service. The transfer price is usually close to the prevailing market rate when different ...
  8. Investing

    Who are Stakeholders?

    “Stakeholder” is used in commerce to describe any party who has an interest in a business or enterprise. Traditionally, stakeholders in a corporation are shareholders, employees, customers and ...
  9. Economics

    Afraid Of A New Financial Crisis?

    It may be time for the U.S. to adopt a model for financial companies that better deters risky financial behavior.
  10. Investing

    What's a Subsidiary?

    A subsidiary is a corporation owned 50% or more by another corporation. The owning corporation is usually called the parent or holding company. A company that is 100% owned and controlled by ...

You May Also Like

Hot Definitions
  1. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  2. Productivity

    An economic measure of output per unit of input. Inputs include labor and capital, while output is typically measured in ...
  3. Variance

    The spread between numbers in a data set, measuring Variance is calculated by taking the differences between each number ...
  4. Terminal Value - TV

    The value of a bond at maturity, or of an asset at a specified, future valuation date, taking into account factors such as ...
  5. Rule Of 70

    A way to estimate the number of years it takes for a certain variable to double. The rule of 70 states that in order to estimate ...
  6. Risk Premium

    The return in excess of the risk-free rate of return that an investment is expected to yield. An asset's risk premium is ...
Trading Center