Do you often go to the evening to buy a register, pen, chart paper etc. from a small neighborhood stationery store? Well, in all probability during your transaction, you have interacted with the sole owner. The only proprietary business is a popular form of organization and is the most suitable form for small businesses, especially in the early years of their operation. The sole proprietorship refers to a form of a business organization that is owned, managed and controlled by a person, who is the recipient of all benefits and carriers of all risks. It is clear from the word. The word "sole" means "only", and "owner" means "owner". Therefore, the sole owner is the one who is the sole owner of a business.
This form of business is particularly common in the areas of personal services such as beauty parlors, hair salons and small scale activities such as running a retail shop in one area and closing down the business. (ii) Liability: The sole owner has unlimited liability. This means that the owner is personally responsible for the payment of the loan if the business property is not enough to complete all the loans. As the owner's personal assets such as his / her personal car and other assets can be sold to repay the loan. Assume that the total external liabilities of the XYZ dry cleaner, the sole proprietorship firm, is Rs. 80,000 at the time of dissolution, but its asset is Rs. Only Rs 60,000 In such a situation, the proprietor will have to bring in Rs. Even if it sells 20,000 from its personal sources