Which of the following is true of a business operating as a sole proprietorship?

Question

Quizplus · Accepted Answer

A sole proprietorship is not considered a separate legal entity from its owner. The owner is personally liable for all debts and obligations of the business.

Answer: B 
 A sole proprietorship can be sold when the owner decides to do so, as it is not a separate legal entity from the owner. The new owner would simply take over the business and its assets and liabilities.

Answer: C 
 A sole proprietorship does not require governmental approval when being transferred, as there is no legal separation between the owner and the business.

Answer: D 
 A sole proprietorship does not have access to unrestricted capital by means of investments because it is not a separate legal entity and therefore cannot issue stocks or other securities. The owner must rely on personal funds or loans to finance the business.

Which of the Following Is True of a Business Operating