Question

select the correct answer.
ronald is the sole owner of a fast food store. over the past six months, his sales have fallen and the store has been running at a loss as a result of a popular fast food chain outlet opening in the area. friends and relatives who lent ronald money to open the store want him to sell his personal property in order to repay those loans. what ownership category of business is ronald in?
a. limited partnership
b. corporation
c. proprietorship
d. cooperative organization

Explanation:

To determine Ronald's business ownership category, we analyze each option:

• Option A (limited partnership): Involves partners with limited liability, but Ronald is the sole owner, so this is incorrect.
• Option B (corporation): A separate legal entity with shareholders, not a sole - owner structure, so incorrect.
• Option C (proprietorship): A sole proprietorship is a business owned and run by one person, who has unlimited liability (meaning personal assets can be used to pay business debts). Ronald is the sole owner and may have to sell personal property to repay loans, which fits sole proprietorship.
• Option D (cooperative organization): Owned and operated by its members for their mutual benefit, not a sole - owner setup, so incorrect.

Answer:

C. proprietorship