Angelica has been studying various forms of business ownership for her art gallery. She thinks she will select this type of legal structure because it is the easiest and most common form of business ownership for small business owners. (1 point) Responses Partnership Partnership Corporation Corporation Sole proprietorship Sole proprietorship Limited liability company
Sole proprietorship
The correct response is: Sole proprietorship.
The correct answer here is "Sole proprietorship". Sole proprietorship is the easiest and most common form of business ownership for small business owners. But let me explain how I arrived at this answer.
To determine the easiest and most common form of business ownership for small business owners, we need to consider the various legal structures available for businesses. These include partnerships, corporations, sole proprietorships, and limited liability companies (LLCs).
Partnership:
A partnership is a legal structure where two or more individuals share the profits and liabilities of a business. While partnerships offer certain advantages, they may involve more complex legal and financial considerations, such as partnership agreements and shared decision-making.
Corporation:
A corporation is a separate legal entity from its owners, known as shareholders. It provides limited liability protection to shareholders, meaning their personal assets are separate from the business's liabilities. However, forming and managing a corporation requires more formalities and legal obligations, such as filing articles of incorporation, holding annual meetings, and maintaining corporate records.
Limited Liability Company (LLC):
An LLC combines certain benefits of partnerships and corporations. It provides limited liability protection to its owners, known as members, while offering flexibility in terms of management structure and taxation. However, forming an LLC involves filing articles of organization and adhering to specific state regulations.
Sole Proprietorship:
A sole proprietorship is the simplest form of business ownership. It is an unincorporated business owned and operated by an individual. As a sole proprietor, you have complete control over the business and its profits. However, you are personally liable for all debts and obligations incurred by the business.
Considering the options given, Angelica believes that the easiest and most common form of business ownership for small business owners is a sole proprietorship. This is because a sole proprietorship does not require any formal registration or documentation (unless required by local regulations), and it allows for the simplest management structure where the owner retains full control and accountability for the business.
Therefore, the correct answer is "Sole proprietorship".