Which one of the following is a correct statement concerning a sole proprietorship?
A) A sole proprietorship is relatively difficult to form.
B) The profits earned by a sole proprietorship are subject to double taxation.
C) A sole proprietorship is more highly regulated than a corporation.
D) The losses incurred by a sole proprietor are limited to the amount invested in the firm.
E) It may be difficult to transfer the ownership of a sole proprietorship.

Question

Quizplus · Accepted Answer

Sole proprietorships are easy to form, face single taxation, are less regulated than corporations, and the owner is personally liable for all losses, not just the amount invested. However, transferring ownership can be difficult due to the business being tied to the individual owner.

Which One of the Following Is a Correct Statement Concerning