Final answer:
Dorothy D.D.S. most likely chose a sole proprietorship when opening her dental practice if she's the sole owner, due to the structure's simplicity and full control it offers, despite the personal liability involved.
Step-by-step explanation:
To determine what legal structure Dorothy D.D.S. chose when opening her dental practice on January 1, we must consider the various types of business structures available. These include sole proprietorship, partnership, corporation, and Limited Liability Company (LLC). A sole proprietorship is a business owned and run by one individual, where the business is not a separate entity from the owner.
The owner is responsible for all debts and liability of the business and is entitled to all profits. Partnerships involve two or more individuals who share ownership and responsibilities of the company. A corporation is a separate legal entity owned by shareholders, providing limited liability but subject to more regulations. An LLC combines the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation.
Given that Dorothy D.D.S. is opening a dental practice, if she is the only owner and plans to be solely responsible for the practice, the most likely structure she would choose is a sole proprietorship. It's a common structure for small, private businesses where the owner wishes to have full control and is willing to accept full personal liability for the business's debts and obligations. If she were to join with other dentists and share ownership, then a partnership or LLC might have been more appropriate. The decision on business structure affects taxation, liability, and management control, among other things.