Problem Description:
The task involves completing a worksheet related to business organizations. The specific question in focus is:
Question 13:
"Which of the following is an example of a
sole proprietorship?"
#### Options:
1. McDonald's
2. Walmart
3. A local bakery owned by one person
4. Microsoft
---
Solution Explanation:
#### Step 1: Understanding the Concept of a Sole Proprietorship
A
sole proprietorship is a type of business organization where a single individual owns and operates the business. Key characteristics include:
-
Single Ownership: The business is owned by one person.
-
No Legal Distinction: There is no legal separation between the owner and the business (the owner is personally liable for all debts and obligations).
-
Ease of Formation: It is relatively easy and inexpensive to start, as it does not require extensive legal formalities.
#### Step 2: Analyzing Each Option
Let us evaluate each option to determine which one fits the definition of a sole proprietorship:
1.
McDonald's:
- McDonald's is a large multinational corporation with thousands of locations worldwide.
- It is not owned by a single individual but rather by shareholders through its publicly traded stock.
-
Conclusion: Not a sole proprietorship.
2.
Walmart:
- Walmart is also a large multinational corporation with numerous stores and employees.
- It is owned by shareholders and has a complex organizational structure.
-
Conclusion: Not a sole proprietorship.
3.
A local bakery owned by one person:
- This describes a business that is owned and operated by a single individual.
- It fits the definition of a sole proprietorship because it is owned by one person without any partners or shareholders.
-
Conclusion: This is a sole proprietorship.
4.
Microsoft:
- Microsoft is a global technology company with many employees and shareholders.
- It is not owned by a single individual but rather by multiple stakeholders.
-
Conclusion: Not a sole proprietorship.
#### Step 3: Identifying the Correct Answer
Based on the analysis, the only option that matches the definition of a sole proprietorship is:
-
Option 3: A local bakery owned by one person
---
Final Answer:
$$
\boxed{3}
$$
Parent Tip: Review the logic above to help your child master the concept of business organization worksheet.
