Which of the following are benefits enjoyed by sole proprietorships? Select the two correct answers.(1 point) Responses easy access to credit easy access to credit earning goes directly to the owner earning goes directly to the owner control of decision-making control of decision-making unlimited liability unlimited liability limited liability
The two correct answers are:
1. Earning goes directly to the owner.
2. Control of decision-making.
The correct answers are:
1) Earning goes directly to the owner
2) Control of decision-making
To determine the benefits enjoyed by sole proprietorships, let's analyze each option:
1. Easy access to credit: This can be a benefit for sole proprietorships because, as the sole owner of the business, it may be easier to secure credit since decisions are made by a single person and there is no need to consult partners or shareholders.
2. Earning goes directly to the owner: This is also a benefit of sole proprietorships. As the sole owner, any profits earned by the business belong solely to the owner. There are no shareholders or partners to divide the earnings with.
3. Control of decision-making: This is another benefit of sole proprietorships. As the sole proprietor, you have complete control over the business and the decision-making process. You don't need to consult with partners or shareholders before making any decisions.
4. Unlimited liability: This is not a benefit but a disadvantage of sole proprietorships. It means that the owner is personally responsible for any debts and liabilities of the business. This can put the owner's personal assets at risk.
5. Limited liability: Limited liability is a benefit enjoyed by other business structures, such as corporations or limited liability companies (LLCs), where the owners' personal assets are protected. However, sole proprietorships do not have this benefit.
Based on the explanations, the correct answers that represent benefits enjoyed by sole proprietorships are:
1. Easy access to credit
2. Earning goes directly to the owner
Therefore, the correct answers are: easy access to credit and earning goes directly to the owner.