Question

Which one of the following statements concerning a sole proprietorship is correct?

a. A sole proprietorship is designed to protect the personal assets of the owner.
b. The profits of a sole proprietorship are subject to double taxation.
c. The owner of a sole proprietorship is personally responsible for all of the company's debts.
d. There are very few sole proprietorships remaining in the U.S. today.
e. A sole proprietorship is structured the same as a limited liability company.

Answer 1

Answer:

c. The owner of a sole proprietorship is personally responsible for all of the company's debts.

Explanation:

A sole proprietorship is a form of business which is owned by one person. The owner has unlimited liabilities. The profit of a sole proprietorship is taxed once .

A limited liability company is owned by more than one person and has a limited liability,hence, a sole proprietorship is not structured like a limited liability company.

I hope my answer helps you