Question

Write any three characteristics of Sole Proprietorship.

State three characteristics of sole proprietorship.

Answer 1

1. Ownership by one man: It is owned by a single person. The sole trader contributes the required capital. He is not only the business owner but also manages all the affairs.
2. Freedom of work and Quick Decisions: Here, a person himself is an owner; he does not need to consult anybody else. Hence, he can make quick decisions.
3. Unlimited Liability: When his business assets are not sufficient to pay off the business debts, he has to pay from his personal property.