A sole proprietorship involves one person owning and managing a business, with the owner bearing personal liability for debts and obligations. Consideration of the risks and benefits is crucial when opting for a sole proprietorship.
Sole proprietorship is a type of business organization where a single individual owns and operates the business, assuming all profits and losses.
One of the main disadvantages of a sole proprietorship is the unlimited liability the owner faces, making them personally responsible for all debts and obligations of the business.
Despite the advantages of ease of management and decision-making, the owner's personal assets are at risk in the event of bankruptcy or lawsuits, highlighting the importance of carefully considering the implications of choosing a sole proprietorship.
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