Asked by Jhane Hemingway on Jul 01, 2024
Two disadvantages of a proprietorship are (1) the relative difficulty of raising new capital and (2) the owner's unlimited personal liability for the business's debts.
Unlimited Personal Liability
A legal obligation where an individual's personal assets can be used to satisfy the debts and liabilities of the business.
New Capital
Funds raised by a company through issuing new shares or debt to finance its business activities.
- Gain an understanding of the distinctions in accountability, taxation, and ownership transition ease among distinct business entities including sole proprietorships, partnerships, and corporations.
Learning Objectives
- Gain an understanding of the distinctions in accountability, taxation, and ownership transition ease among distinct business entities including sole proprietorships, partnerships, and corporations.