Question

"Sole trade is best among the world if the trader is skilled enough to handle all the business-related tasks and responsibilities. Elucidate this and also state its limitations.
Or
State the disadvantages of a sole trader.

Answer 1

Answer:

Here r some of the disadvantages of Sole Proprietorship

Explanation:

Sole provider of capital - this limits the size of business . Yes , banks and lenders may provide additional resources. However , borrowing capacity too is determined by capital adequacy.

This feature also limits the capacity to grow.

Unlimited liability - This arises from being the sole provider of capital. If all the profits belong to him/her so the losses.

Fate as a Going Concern (Going Concern = enduring life of business in the foreseeable future ) - sole proprietary entities Going Concern status depends on the owner's personal health and life span and after his death upon the willingness and ability of his heirs/successors in the family