Sole
Proprietorship:
Definition
Sole Proprietorship
is that type of business which is owned by one person.
Advantages
of Sole Proprietorship
Freedom in formation
The easiest to
establish
Individuals are
allowed to decide without interference of any other person.
Easier to transfer
the ownership of the business
People wholly solely
enjoy the ownership of the business and profits
Individual has
unlimited opportunity to expand the size of the business
Individual can keep
the secrets of the business intact
Individual has
personal interest in the business
Owners can make speedy
decisions
Easy to dissolve
Disadvantages
of Sole Proprietorship
Limited amount of
capital
Continuity problem
Sole Proprietorship
has limited life and is dependent on the owner
Owner of the business
has unlimited liability towards people whom he has to pay
Partnership
A relationship of the
people to share investments and profits
Partnership act 1932
governs all affairs of the partnership
Advantages
of Partnership
More capital
Relatively easier to
form
Sharing of
responsibility
Light credit standing
Business can have
more loan from various sources
Secrecy Public
Confidence
Better Decision
Easy
to dissolve
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