Question

Jill owns a retail business by herself and was sued by a customer who fell in the store. The customer claimed the business was negligent in caring for its floors. Which statement best describes Jill's potential liability?

a. Jill has no potential liability to the customer.
b. Jill can be held personally liable to the customer since she is the owner.
c. Jill can only be liable to the amount she initially invested in the business.
d. Jill cannot be held personally responsible; the woman's insurance must pay for the claim.

Answer 1

Jill can be held personally liable to the customer since she is the owner. This is one of the disadvantages of a sole proprietorship.

Step-by-step explanation:

Jill can be held personally liable to the customer since she is the owner. As a sole proprietor of a retail business, Jill is responsible for all debts and liabilities of the business. This means that if a customer sues the business for negligence, Jill can be held personally responsible for any damages or compensation awarded to the customer.

This liability is one of the disadvantages of a sole proprietorship. Since the business is not a separate legal entity from the owner, the owner's assets can be at risk in the event of a lawsuit.

Therefore, option b. Jill can be held personally liable to the customer since she is the owner, which best describes Jill's potential liability in this situation.