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Business Studies

Merits and Limitations of Sole Proprietorship

Why is it sai...

Question

Why is it said that sole proprietorship has a limited life of business ?

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Solution

Being the sole owner, illness death, insolvency etc of the sole proprietor can lead to the closure of the business.

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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. Fill in the blanks:
(a) Sole proprietorship is the _______ from of business enterprises, (latest / oldest)
(b) Sole proprietorship is most suitable form for _______ business, (small / large)
(c) Liability of a sole proprietor is ________ (limited / unlimited)
(d) Sole proprietorship _______ a separate legal entity, (has / does not have)
(e) It is ______ to set up a sole proprietorship firm,(easy / difficult)

Q. Following is not a characteristic of sole proprietorship business _______________.

Q. Which one of the following is NOT a feature of sole proprietorship business?

Q. The sole proprietorship form of business discourages self employment.

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Merits and Limitations of Sole Proprietorship

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