Ralph Flores owns and operates his own business as a sole proprietor. Recently his company was sued. The fact that Ralph's business is a sole proprietorship means that Ralph is personally protected against any financial loss if the company loses the lawsuit.

Question

Quizplus · Accepted Answer

As a sole proprietor, Ralph is not separate from his business, so he has unlimited personal liability for any financial loss. In other words, his personal assets could be at risk if the company loses the lawsuit.

Ralph Flores Owns and Operates His Own Business as a Sole