• A business owned by one person.
• The most common form of ownership in our economy.
• E.g stores, farms, service businesses.
• From an accounting viewpoint, it is a business entity separate
from the affairs of the owner.
• From a legal standpoint, they are not separate entities and the
owner is personally liable for the debts of a business.
• If the business fails, creditors may force the owner to sell personal
assets to pay off debts.
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