Which of the Following Is Not an Advantage of a Sole

question 99

Multiple Choice

Which of the following is not an advantage of a sole trader?

• A) It is easy to form and dissolve.
• B) It has unlimited liability.
• C) Profits are taxed as personal income.
• D) There owner has the flexibility of being his or her own boss.
• E) The owner keeps all profits.

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Definitions:

Balance Sheet

A financial statement that provides a snapshot of a company's financial position at a specific time, detailing assets, liabilities, and equity.

Net Income

The amount of money that remains after all expenses, including taxes and costs of goods sold, have been subtracted from total revenue, indicating the profitability of a company.

Financing Activities

refers to transactions related to raising capital and repaying shareholders, including issuing shares, borrowing, and repaying debt.

Cash Flows

The net amount of cash being transferred into and out of a business, considered vital for its solvency.