Question

What are the advantages of choosing a partnership instead of operating a business as a sole proprietor? (Choose three.) There are more sources of funding for start-up capital purchases. When the owner dies, the business remains completely intact and can proceed without any type of restructuring. There is a way to continuously raise capital through the issuing of stocks and bonds. There are multiple sources of knowledge and expertise available to run the business. All of the liability does not fall on just one of the owners.

a) There are more sources of funding for start-up capital purchases.
b) The business remains intact if the owner dies.
c) Continuous capital raising through stocks and bonds.
d) Multiple sources of knowledge and expertise.
e) All of the liability does not fall on just one owner.

Answer 1

The advantages of choosing a partnership instead of operating a business as a sole proprietor are increased sources of funding, access to multiple sources of knowledge and expertise, and shared liability among the partners.

Step-by-step explanation:

The advantages of choosing a partnership instead of operating a business as a sole proprietor are:

1. More sources of funding for start-up capital purchases: In a partnership, multiple partners can contribute capital, increasing the potential sources of funding for the business.
2. Multiple sources of knowledge and expertise: With partners, there is a pool of knowledge and expertise available to run the business, which can greatly benefit decision-making and problem-solving.
3. All of the liability does not fall on just one owner: In a partnership, the liability is shared among the partners, reducing the burden on a single owner in case of debts or legal issues.