When a Sole Proprietor Dies, His or Her Business Is

question 51

Multiple Choice

When a sole proprietor dies, his or her business is automatically

• A) transferred to his or her heirs.
• B) dissolved.
• C) transferred to the state.
• D) transferred to the federal government.

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Definitions:

Production

The process of creating goods or services through the combination of labor, materials, and technology.

Inventory Carrying Costs

The expenses related to storing unsold goods, including warehousing, insurance, depreciation, and opportunity costs.

Purchasing Costs

The total expenses incurred in buying goods or services, including the price of the product, taxes, shipping, and handling fees.

Stockouts

The situation that occurs when an item is not in stock and cannot be sold to a customer, often leading to lost sales and customer dissatisfaction.