Is it a Sole Proprietorship
Freelance piano teacher
Yes!
Sole proprietorships have limited access to _______.
Resources
If Sarah, a sole proprietor of a small bookstore, neglects to pay her supplier, Mike's Office Supplies, for the shipment of office essentials, who’s liable: Mike‘s Office Supplies or Sarah?
Sarah is personally liable for the debt. The bookstore and Sarah are treated as one legal entity in this sole proprietorship, making her personally responsible for settling the outstanding payment.
Fill in the blank:
The owner may use all ____ for the business.
profits
McDonalds
No.
True or false: sole proprietorship is ran by many people with different skills
False: it is ran by only one person
People have limited knowledge of what in sole proprietorships?
Suppose Bob, the sole proprietor of "Bob's Bouncing Balloons," hires Joe as a balloon twister. In an unexpected twist, Joe loses his hand while crafting a balloon animal at a birthday party. Who‘s liable to pay for Joe‘s new hand: Bob, Joe, or the birthday party host?
Bob, as the sole proprietor, is typically held liable for workers' compensation claims.
Does the Sole Proprietor have complete control of the business
Yes
Claire starts her own florest business
Yes.
True or False: start up costs are high for sole proprietorship
False: costs are very minimal
Who does the buisness pass onto if the sole propritership owner dies?
No one. The goverment sees thee buisness and the sole propriter as one!
Sparkle Unicorn Cupcakes, a bakery owned by Wendy is upgrading kitchens. Wendy signs a lease for a magical cupcake castle. However, if Wendy accidentally turns her cupcakes into confetti and stops being able to pay rent, who‘s liable: Wendy or the business that sold her the magical cupcake castle?
Wendy, as the sole proprietor, is personally responsible. Unless the lease includes a clauses that limits Wendy's personal liability.
How many legal costs are there in forming a sole Proprietorship?
Very little!
Limited Liability Company (LLC)
No.
What is the biggest disadvantate of being a sole proprietorship?
Unlimited personal liablity
Phil, the sole proprietor of "Phil's Slippery Banana Peel," is facing a lawsuit after a banana peel incident at his shop. An unfortunate customer, Sid, slipped on a banana peel after an employee of the Slippery Banana Peel left one out. Now, with Sid claiming banana related trauma, Phil's business is entangled in a legal dilemma. Whos liable: Phil, Sid, or the employee?
Phil holds primary liability for the actions of his employee, which caused Phils trauma
What are the 2 reasons sole proprietorships are easy to discontinue?
1. Following tax and debt settlement, there are no legal impediments.
2. There are no additional legal obstacles preventing a business to discontinue.