Which of the following is an advantage of the sole proprietorship form of ownership? A. Unlimited liability B. Control over the business C. Limited liability D. Split responsibility

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Francesca Chang

Business

13 October, 00:57

Which of the following is an advantage of the sole proprietorship form of ownership? A. Unlimited liability B. Control over the business C. Limited liability D. Split responsibility

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Prissy · Answer 1

A sole proprietorship, also known as the sole trader or simply a proprietorship, is a type of enterprise that is owned and run by one natural person and in which there is no legal distinction between the owner and the business entity. The owner is in direct control of all elements and is legally accountable for the finances of such business and this may include debts, loans, loss, etc.

The sole trader receives all profits (subject to taxation specific to the business) and has unlimited responsibility for all losses and debts. Every asset of the business is owned by the proprietor and all debts of the business are the proprietor's. It is a "sole" proprietorship in contrast with partnerships (which have at least two owners).

A sole proprietor may use a trade name or business name other than his, her, or its legal name. They may have to legally trademark their business name if it differs from their own legal name, the process varying depending upon country of residence. [1]