A guarantee of profit is when one or more partners or, in some cases, the company itself promises to make a certain amount of money. The person who makes the guarantee of profit is the one who has to keep this promise. Basically, it means a set minimum amount that is a guarantee of profit to a partner.
If the actual share of profits is less than the promised amount, the company or the partner in question must pay the difference. When this happens, the company will make a number of changes. On the other hand, if the partner's actual share of income is higher than the guaranteed minimum, the company will give them the extra profits.Also Read- Issue and Redemption of Debentures
Also Read- Difference Between E-Commerce and E-Business
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