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Question

The business assests of a organisation amount to Rs 20,000 but the liabilities that remained uppaid are Rs 45,000. What course of action can the creditors take if the organisation is a sole proprietorship firm ?

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Solution

In case of sole proprietorships firm the liability of the owner is unlimited so the creditors can take the personal property of the owner for Rs 25,000/- and can have Rs 20,000 by selling the assets of the organisation.


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