Question

What are the four primary disadvantages of the sole proprietorship and partnership forms of business organization? What benefi ts are there to these types of business organization as opposed to the corporate form?   

Answer 1

The following are the four primary disadvantages of the sole proprietorship and partnership forms of business organisation are as follows :

1 ) unlimited liability

2 ) limitedlife

3 )difficulty transferring ownership

4)difficulty in raising capital funds

Benefits of sole proprietorship and partnership forms when compared to corporate form are as follows :

less regulation

the owners are also the managers

sometimes personal tax rates are better than corporate tax rates