Suppose Theo owns a proprietorship that is in serious financial difficulty.The assets of the company are $100,000, but liabilities are $175,000.However, Theo also has stock in General Motors worth $200,000.If Theo files for bankruptcy, what amount of personal assets might he lose?

Question

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In a proprietorship, the owner's personal assets are not protected from the business's liabilities. Theo's business owes $175,000 but only has $100,000 in assets, leaving a $75,000 shortfall. This amount could be claimed from Theo's personal assets, including his General Motors stock, to satisfy business debts.

Suppose Theo Owns a Proprietorship That Is in Serious Financial