250 words APA formatted referencesYour client through YOUCPA—a 50-year-old owner of a firm—has...

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250 words APA formatted referencesYour client through YOUCPA—a 50-year-old owner of a firm—has requested that 
she become a sole proprietorship in the state. The owner does not like paperwork 
and reporting of information. Her goal is to keep the business simple for her. 
The firm will have losses in the early years. However, you forecast steady 
profits for the firm after the 3rd year. She is contemplating passing on the 
firm to her son, Kate.
After looking at this situation, you are contemplating recommending that she 
form a limited liability corporation (LLC).

Describe the advantages of each of the following:

A sole proprietorship
A limited liability corporation
Do you recommend that this client choose an LLC or not? Explain your 
rationale.

Robert · Accepted Answer

Sole Proprietorship 
In sole proprietorship, the individual is involved in doing the business. The enterprise running on 
small scale chooses sole proprietorship as the means of doing business. It is quite easy to 
formulate and involves low startup cost and low operational overhead.  
Advantages of conducting a business as a sole proprietor 
1.  Easy Formation: It is very easy and simple procedure to form a sole proprietorship. 
 There  are no legal formalities in setting up the business, as no license and permission 
 required. The business can be started with certain amount of capital invested by the 
 owner. 
2.   Direct control & motivation: The entrepreneur takes all the decisions and chalks out plan 
  and strategies which results in better control and ultimately leads to better efficiency. 
3.  Decision Making: There is only one person to take decisions, so quick decision can be 
 taken.  
4.  Secrecy:

250 words APA formatted references Your client through YOUCPA—a 50-year-old owner of a firm—has requested that she become a sole proprietorship in the state. The owner does not like paperwork and...

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