A Significant Disadvantage of Owning a Sole Proprietorship Is The

question 260

Multiple Choice

A significant disadvantage of owning a sole proprietorship is the:

• A)Possibility of limited liability.
• B)Heavy tax liability that must be assumed.
• C)Overwhelming time commitment often required of the owner.
• D)Lack of incentives to motivate the owner.

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Definitions:

Direct Lease

A rental agreement directly between the landlord and tenant, excluding any subleasing arrangements.

Tax Benefits

Financial advantages granted by governmental policies to reduce a taxpayer's burden, often to encourage certain business activities or investments.

Capital Lease

A lease classified as an asset on a company's balance sheet, indicating the lessee has ownership-like rights.