Two key limitations of the proprietorship form of business involve potential difficulty in raising the necessary capital and the presence of unlimited personal liability for business debts.
Answer the following statement true (T) or false (F)
True
It is difficult for a proprietorship to obtain large sums of capital because the firm's financial strength is generally based solely on the financial strength of the only owner. The proprietor has unlimited personal liability for business debts because any debts of the business are considered obligations of the sole owner. See 1-2: Alternative Forms of Business Organization
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Indicate whether the statement is true or false
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Indicate whether the statement is true or false