Definitions
What is a sole trader?
An individual who owns his/her personal business with no additional help.
What happens to the business when the owner decides to go on a holiday or becomes ill?
Lack of continuity
What famous french fashion designer started as a sole proprietoreship in 1910?
Coco Chanel
Define unincorporated
The owner is the same legal entity as the business itself
Name any 2 reasons why sole trading is popular in America
- Easy to start
- No extra taxes
- You become your own boss
- Easy to exit
Which famous fast food chain known for their root beer started as a sole proprietorship?
A&W
What does unlimited liability mean?
Owner is personally responsible for all loses and debts of the business.
Name two important disadvantages of a sole proprietorship?
- Unlimited liability
- Limited sources of finance (difficult to secure funds beyond personal savings)
Babysitting
Lawn mowing
Youtuber/Gamer
What is start-up capital?
The funding from the individual, usually from personal savings and borrowing.