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 ?

Open in App

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.

Suggest Corrections

Similar questions

The business assets of an organisation amount to Rs. 50,000 but the debts that remain unpaid are Rs. 80,000. What course of action can the creditors take if
(a) The organisation is a sole proprietorship firm
(b) The organisation is a partnership firm with Anthony and Akbar as partners. Which of the two partners can the creditors approach for repayment of debt? Explain giving reasons

Q. The business assets of a firm are worth Rs. 70,000 but the debts remain unpaid are worth Rs. 1,00,000. What course of action can the creditors take in the following cases:
(i) The organisation in sole proprietorship firm.
(ii) The organisation in partnership firm with Anthony and Akbar, two partners sharing profit equally.

Q. Answer is Yes or No:
(a) The sole proprietor is the exclusive master of his business.
(b) The liability of a sole proprietor is limited.
(c) A sole proprietorship has no legal existence apart from its owner.
(d) Sole proprietorship is the oldest form of business organisation.
(e) It is difficult to set up a sole proprietorship.

Q. Sole proprietorship form of business organisation is suitable ________.

Q. The outside liabilities of a business are Rs.

20, 000

. The proprietor's capital is Rs.

50, 000

. Total assets of the firm are worth ___________.

Join BYJU'S Learning Program