Forms of Business Organisation · Class 11 · CBSE · Commerce Business Studies
Which feature is most closely associated with a sole proprietorship?
Practice question from Forms of Business Organisation (Class 11 · CBSE · Commerce Business Studies), with the correct answer and a step-by-step solution.
easy · MCQ · Q-D6967F
Which feature is most closely associated with a sole proprietorship?
- A.Separate legal existence from the owner
- B.Unlimited liability of the proprietorCorrect answer
- C.Compulsory registration under the Companies Act
- D.Management by an elected board of directors
Solution
A sole proprietor and the business are not legally separate. Therefore, the proprietor has unlimited liability for the business debts.
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