Which statement describes ownership in a sole proprietorship?

• A. The owner
• B. Board of Directors
• C. Shareholders
• D. The Government

Answer: (A)

In a sole proprietorship, ownership rests with a single individual who owns the business’s assets and makes all the decisions. This person has full control, keeps all profits, and is personally responsible for debts and obligations of the business. The other options describe ownership or governance structures that don’t apply to a sole proprietorship: a board of directors governs corporations; shareholders own shares in a corporation; and the government is not the owner of a typical private sole proprietorship. So, the statement that describes ownership in a sole proprietorship is that the owner is the sole proprietor who owns and controls the business.