Understanding Business
11th Edition
ISBN: 9780078023163
Author: William G Nickels, James McHugh, Susan McHugh
Publisher: McGraw-Hill Education
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Question
Chapter 5.1, Problem 2TP
Summary Introduction
To determine: The reason for which unlimited liability is considered to be the major drawback to sole proprietorship.
Introduction:
When the business is managed and owned by a person single handedly, it is known as sole proprietorship.
The legal obligations of the sole proprietors to pay for all the debts of the company even if it takes to pay it from the personal assets of the proprietor, is known as the unlimited liability.
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Chapter 5 Solutions
Understanding Business
Ch. 5.1 - Prob. 5.1AQCh. 5.1 - Prob. 5.1BQCh. 5.1 - Prob. 1TPCh. 5.1 - Prob. 2TPCh. 5.2 - Prob. 5.2AQCh. 5.2 - Prob. 1MEDCh. 5.2 - Prob. 3TPCh. 5.2 - Prob. 4TPCh. 5.3 - Prob. 5.3AQCh. 5.3 - Prob. 5.3BQ
Ch. 5.3 - Prob. 5TPCh. 5.3 - Prob. 6TPCh. 5.3 - Prob. 7TPCh. 5.3 - Prob. 8TPCh. 5.4 - Prob. 5.4AQCh. 5.5 - Prob. 5.5AQCh. 5.5 - Prob. 5.5BQCh. 5.5 - Prob. 5.5CQCh. 5.6 - Prob. 9TPCh. 5.6 - Prob. 10TPCh. 5.6 - Prob. 11TPCh. 5 - Prob. 1CTCh. 5 - Prob. 2CTCh. 5 - Prob. 3CTCh. 5 - Prob. 4CTCh. 5 - Prob. 1DWSCh. 5 - Prob. 2DWSCh. 5 - Prob. 3DWSCh. 5 - Prob. 4DWSCh. 5 - Prob. 5DWSCh. 5 - Prob. 1TITCh. 5 - Prob. 2TITCh. 5 - Prob. 1VCCh. 5 - Prob. 2VCCh. 5 - Prob. 3VC
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Similar questions
- What are the advantage and disadvantage of sole proprietorship?arrow_forwardWhat is the funding and management of Sole Proprietorship; Partnerships; Corporations and Limited Liability Company?arrow_forwardhow is a limited partnership transferred or sold and how the ownership interests would be handled?arrow_forward
- Suppose a partnership is set up and operated without a formal partnership agreement. What problems might arise? Explainarrow_forwardWhat are some common challenges faced by sole proprietors, and how can they overcome them?arrow_forwardArticulate the advantages and disadvantages of partnerships, LPs, LLCs, and LLPs. Please be sure to include in your discussion the characteristics of each type of business entity and what makes them unique.arrow_forward
- What is a partnership? Outline the legal issues involved in the formation of a partnership. In your answer, discuss the issues that partners should consider in drafting the partnership agreement.arrow_forwardWhat are the main differences between general partnership and limited partnership?arrow_forwardIs a limited partnership more likely or less likely to have a partnership agreement than a general partnership?arrow_forward
- What are the legal obligations and liabilities of business owners, partners, and shareholders in a corporation?arrow_forwardHow do the shareholders who own a company choose the actual company managers?arrow_forwardWhat are the legal requirements and considerations for forming a business entity, such as a corporation or a partnership?arrow_forward
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