Asked by Nurul Izzati on Jun 20, 2024
Verified
Salma owns a pharmacy near a hospital.She started the business with a personal loan and is wholly responsible for repaying it.Salma also needs to pay personal income tax on the profits generated from the business.Her business is an example of a(n) :
A) joint venture.
B) S corporation.
C) sole proprietorship.
D) cooperative.
E) C corporation.
Sole Proprietorship
A type of enterprise that is owned and run by one person and in which there is no legal distinction between the owner and the business entity.
Personal Loan
An unsecured loan provided by a financial institution based on the borrower's creditworthiness, typically used for personal expenses or consolidating debt.
Personal Income Tax
A tax levied on individuals or households based on the income they receive from work, investments, or other sources.
- Ascertain the positive and negative aspects of sole proprietorships.
Verified Answer
AY
Archana YadavJun 23, 2024
Final Answer :
C
Explanation :
Salma's business is an example of a sole proprietorship because she owns the business alone, is personally responsible for its debts, and pays personal income tax on the profits.
Learning Objectives
- Ascertain the positive and negative aspects of sole proprietorships.