Question

Kali owns Dog Trotters, a dog-walking business that she started to earn money after school and supplement her allowance. She planned to keep all the profits, and has kept things simple by putting a flier on the bulletin board at the local grocery store announcing that she was available to provide this service. Kali's business is a:

A. sole proprietorship.
B. franchise.
C. S corporation.
D. partnership.

Answer 1

Kali's dog-walking business, Dog Trotters, which she independently manages and uses to earn additional income, is classified as a (A) sole proprietorship, as it is a business owned and run by an individual without formal incorporation.

Step-by-step explanation:

Kali owns Dog Trotters, a dog-walking business which she started to earn money after school and supplement her allowance. She is the sole owner, responsible for all the profits, as well as debts and liabilities.

The description of Kali's business indicates that it is a sole proprietorship. This is the simplest business form, where the business and the owner are considered one entity, and it does not undergo any formal incorporation process. The owner of a sole proprietorship gets to keep all the profits but is also personally responsible for all of the business's debts and liabilities.