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Answered Same Day Dec 23, 2021

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Robert answered on Dec 23 2021

131 Votes

Part 1
1a. Sole proprietor- Advantages
 It is easy to form
 Flexibility of operations
 Low start up costs and personal liability
Disadvantages
 There is a heavy burden as he has to bear the losses alone
 Difficulty in raising money.
 Limited managerial capacity
1b. Partnership
 Easy to establish a partnership firm
 Being more than one person it is easy to raise funds
 Cost effective with specialized skills
Disadvantages
 The partners are jointly liable for the actions
 Unlimited liability
 It has a limited life i.e. it gets dissolved when other partner dies, goes insane etc
 Non transferability of interest to third party
1c. Private limited company- Advantages
 It has limited liability i.e. members are liable only to the extent of their contribution
 There is a continuity in existence
 More capital can be raised with many members and shareholders
Disadvantages
 Growth is limited as the maximum number of members is 50
 The shares cannot be sold and transferability of interest cannot be done without the
permission of shareholders
1d. Public Limited Company-Advantages
 Limited liability for the shareholders
 The business has a separate legal liability
 The company can raise capital as there is no maximum limit for the number of
shareholders
Disadvantages
 Involves lot of legal formalities to form a public limited company
 The members who begin the company may lose control.
Cooperative- Advantages
 It is easy to form a cooperative society
...

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