Question

What are the disadvantages of partnerships and sole proprietorships?

Answer 1

Burdens of sole ownership incorporate the accompanying:

• Need to supply every one of the various abilities expected to make the business a triumph.

• In the event of death, the business breaks down.

• Need to depend on your assets for financing.

• In the event that the organization causes a debt or experiences a disaster, sole proprietors are responsible.

An association/ partnership has a few weaknesses over sole ownership:

• Shared dynamics can bring about conflicts.

• Benefits/ profits should be shared.

• Each accomplice/partner is responsible for their behaviour as well as for other partners, everything being equal—a guideline called limitless responsibility.

Also see:

• MCQs on Partnership
• What Is Partnership?
• Difference Between Sole Proprietorship and Partnership
• Nature of Partnership

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