Which of the following is not an advantage of operating a business as a sole proprietorship?Multiple choice question.Immunity from personal liabilityManagerial controlMinimal legal formalities in start-upSingle taxation
Question
Which of the following is not an advantage of operating a business as a sole proprietorship?Multiple choice question.Immunity from personal liabilityManagerial controlMinimal legal formalities in start-upSingle taxation
Solution
The option that is not an advantage of operating a business as a sole proprietorship is "Immunity from personal liability". In a sole proprietorship, the owner is personally liable for all debts and obligations of the business. This means that if the business incurs a debt or is sued, the owner's personal assets can be used to satisfy these obligations. This is a significant disadvantage compared to other business structures, such as corporations or limited liability companies, where the owners' personal assets are generally protected from business liabilities.
Similar Questions
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