Question

what do you mean by sole proprietorship explain the characteristics of sole proprietorship

Answer 1

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$\frak\red{\underbrace{\underline{\bigstar\bf\: Meaning:}}}$

• Sole proprietorship is a firm in which business activities like management, decision making, etc is all done by one person.

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$\frak\red{\underbrace{\underline{\bigstar\bf\: Characteristics:}}}$

• Ownership of one:- As there is only one owner hence whole business is owned by him.
• Quick Decision Making:- Only one owner owns the business hence he or she can make quick decision according to him or her.
• Unlimited Liability:- All liability is paid by owner only. In case if he or she is not able to pay it then he or she have to sale his or her properties inorder to pay it.
• Limited Capital:- Capital is brought by the owner only hence it will have limited capital as compared to partnership firm.
• No stress of share:- As he or she own the business the loss or profit belong to him or her.
• Administration Management by owner only:- Both the activities is handled by only owner. No interference.

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