1. Forms of business ownership

Question 1

feature of sole proprietorship i_n term of ownership_.

Answer 1

Sole proprietorship - Owned by one person.

Question 2

Feature of sole proprietorship in term of access of funds

Answer 2

Sole proprietorship

• It less likely for banks and other lenders to lend money to the SP due to lack of personal assets that can be serve as collaterals
• Access of funds is usually limited to the personal funds of the owners.

Question 3

Feature of sole proprietorship in term of risk (extend of liability)

Answer 3

Sole proprietorship

• Sole owner is obliged to pay the business liabilities using his or her personal assets if business assets are insufficient to settle the debts (unlimited liabilities).

Question 4

Feature sole proprietorship in term of level of control

Answer 4

Sole proprietorship

• Owner usually runs the business by himself or herself and has _absolute contro_l over the business.

Question 5

Different between sole proprietorship and private limited company in term of transferability of ownership

Answer 5

Sole proprietorship - It is easy to transfer ownership by notifying the corporate regulatory authority.

Private limited company - Shareholders simply sell away their shares

Question 6

Feature of sole proprietorship_in term of formalities and procedures_.

Answer 6

Sole proprietorship

• There is minimal administrative duties to adhere to.