The drawbacks of proprietorship include unlimited liability and difficulty in obtaining financing.

Question

Quizplus · Accepted Answer

Proprietorship means the owner and the business are considered the same legal entity, therefore the owner has unlimited liability for all debts and legal issues. Additionally, obtaining financing can be challenging as the business's financial records and credit history are tied to the owner's personal credit history.

The Drawbacks of Proprietorship Include Unlimited Liability and Difficulty in Obtaining