Business level 2 - Unit 1 p2 answer

Topics: Corporation, Partnership, Small business Pages: 2 (391 words) Published: September 28, 2013

Size: Heffernans Dental Practice is a small business in terms of the number of people employed. There are four dentists employed, four dental nurses and one receptionist/manager and a cleaner. However, the business does make a high profit, and the two partners takes a 50% cut of the other two dentists earnings. Last year the Heffernans Dental Practice made a profit of over £450,000. Despite this level of profit, it would still be viewed as a small business. Scale: Heffernans Dental Practice started in 1988 when the owners, the Heffernans, bought out the widow of the previous owner of a dental practice. They originally had planned to purchase an adjacent property to expand the business, but were unable to when it became available due to lack of finance. They did seek another partner, but that fell through. Therefore, given iti s only one premises, it is a small scale business. Ownership: Heffernans Dental Practice is a partnership. A partnership is a way of sharing with others the managerial and financial responsibility for a business. Legally, a partnership must consist of between 2 and 20 partners. Like sole traders, they usually have unlimited liability – but, they can be limited partnerships as we shall see later. They are mostly appropriate for professional businesses such as doctors, dentists, estate agents and solicitors. A partnership allows people to share capital and skills and expertise. Although all partners are responsible for the business’s debts, one partner is not responsible for another’s private debts. On the other hand, if one partner makes a mistake and signs a bad contract for the business, the other partners will have to honour the contract. The legal regulations, which govern a partnership, are set out in the 1890 Partnership Act. Advantages of a partnership

Responsibilities and decision making are shared.
Continuity and support is possible. Several partners mean the business does not come to a...
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