List the advantages and disadvantages of a sole proprietorship, partnership and corporation.

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Accounting

List the advantages and disadvantages of a sole proprietorship,partnership and corporation.

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Q List the advantages and disadvantages of a sole proprietorship partnership and corporation Ans A sole proprietorship is the simplest business structure in which one person is the owner and operator of the business This sole proprietor is responsible for all aspects of the business and reaps all profits of the business Advantages of Sole Proprietorship Easy to Form Proprietary concerns can be formed easily and quickly Very few legal formalities need to be fulfilled There is no need to go for any registration or enter into an agreement with someone One can form it and dissolve it quickly Full Control The owner has full control over everything He is answerable to no one else He decides everything in the best interests of the business Right or wrong he takes charge of the situation Low Startup Costs Sole proprietorship ranges from having no employees and up to a number of employees which is easier to deal with in terms of expenses taxes and compensation Costs of opening a business with this structure do not require costly legal expenses as well as corporate taxes Profit One of the perks of sole proprietorship is that the owner can keep all the profits to himself unlike if he is on a partnership with another individual or if he has a corporation with investors where profits will be divided among themselves Economical and Efficient Operations The owner can put resources to best use He can take steps to eliminate wastages of all kinds He can control the cost of running the show Disadvantages of Sole Proprietorship Personal and Business Assets One of the drawbacks of sole See Answer

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