Final answer:
The statement is false. In a sole proprietorship, the owner's personal assets are not separated from the business assets, as it is not a separate legal entity. Therefore, the owner has unlimited liability for the business's debts and obligations.
Step-by-step explanation:
If the firm is organized as a sole proprietorship, it is false that the proprietor's personal assets are separable from those of the firm because the firm is a separate legal entity. In a sole proprietorship, the business is not a separate entity from the owner. The owner is responsible for all debts and liabilities of the business, as well as being entitled to all profits generated by the business.
The main concern with a sole proprietorship is the unlimited liability, which means that the proprietor assumes personal responsibility for the debts and obligations of the company. Consequently, the proprietor's personal assets are at risk if the business incurs debt or legal judgments that it cannot pay. Sole proprietors must manage the business effectively and consider their personal financial exposure in relation to the business.