Sole Proprietorship
Completion requirements
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- 2a Discuss the legal forms of businesses, including sole proprietorships, partnerships, corporations, limited-liability corporations, and subchapter S corporations (CLO 3)
Introduction
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Many new business owners choose sole proprietorship because it is the simplest form to start and gives the owner complete control, for better or worse. Read this section, paying particular attention to the discussion on unlimited liability, as it is a significant drawback of sole proprietorships. You may find it interesting to try the exercise at the end of the section and locate a sole proprietor in your area.
A sole proprietorship is a business owned by only one person. The most common form of ownership, it accounts for about 72 percent of all U.S. businesses. It's the easiest and cheapest type of business to form: if you're using your own name as the name of your business, you just need a license to get started, and once you’re in business, you’re subject to few government regulations.
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