Question

Lawrence has a small house painting business with two employees. Lawrence's

father gave his son startup money and occasionally contributes to the business
financially when Lawrence is having a cash flow problem but has nothing to do with
the running of the business. Lawrence always pays his father back out of business
profits. What kind of business does Lawrence have?
A) a partnership
B) a sole proprietorship
C) a cooperative
D) a franchise
E) a corporation

Answer 1

Lawrence runs a sole proprietorship, as he operates his house painting business independently, even though he occasionally receives financial assistance from his father, which he repays.

Step-by-step explanation:

Lawrence has a small house painting business that he operates with two employees. Despite receiving occasional financial help from his father, Lawrence repays it from his business's profits and maintains full control over the day-to-day operations of his business.

Considering this, Lawrence's business is classified as a sole proprietorship. This type of business is owned by an individual who is responsible for all debts, liabilities, and entitled to all profits. The sole proprietor is also faced with the responsibility of hiring and managing employees, managing business operations, and the liabilities associated with business debts and legal actions.