2008 WAEC Commerce Theory Compare a partnership and a public limited company as business unit under the following headings;...

Compare a partnership and a public limited company as business unit under the following headings;

(a) formation
(b) ownership
(c) raising of capital
(d) liability
(e) transfer of shares

	Partnership	Public limited company
Formation	it is simpler, not requiring lots of documentation. It is cheaper and easier to form. It requires deed of partnership.	Cumbersome, requiring lots of documentation and article of association to secure incorporation. It is expensive and takes time to form. It is owned by shareholders through subscription of shares.
Ownership	It is owned by the partners ownership is not separated from the management	Owners are separated from management of the business
Raising of capital	Capital is raised through the funds contributed by partners	Capital is raised through subscription of shares
Liability	The liability of each partner is not limited	The liability of each partner is limited to the amount invested
Transfer of shares	Partnership does not deal with shares, so nothing to transfer.	Shares are transferable from one shareholder to another on the stock exchange market