Asked by Elizabeth Offer on Apr 29, 2024
Verified
A sole proprietorship
A) is subject only to limited liability.
B) experiences little difficulty in accumulating and acquiring financial capital.
C) is simply an individual in business for himself or herself.
D) is very similar to a corporation in its legal status.
E) has infinite life unless it goes bankrupt or is merged.
Sole Proprietorship
A business structure where a single individual owns, manages, and is personally responsible for all aspects of the business, including liabilities.
Liability
A legal obligation or debt that an entity is required to pay to another.
Financial Capital
Economic resources measured in terms of money used by entrepreneurs and businesses to buy what they need to make their products or to provide their services.
- Identify the differences in several business ownership models and their attributes.
Verified Answer
CC
Caroline CapaprisMay 03, 2024
Final Answer :
C
Explanation :
A sole proprietorship is an unincorporated business owned and operated by a single individual. It is not a separate legal entity from its owner and therefore, the owner bears full responsibility for the business's liabilities. Additionally, a sole proprietorship does not have limited liability protection like a corporation or LLC. However, it is easier to start and manage compared to other business structures and there are no formalities required.
Learning Objectives
- Identify the differences in several business ownership models and their attributes.