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Aarti is a sole proprietor over the past 15 years her business has grown from operating a neighbourhood shop selling kurtis, bags, cosmetics etc. to retail chain with four branches in the branches,she is thinking to form a company to manage the business better. she also wants to grow further. a) explain two merits of Aarti remaining a sole proprietor. b) explained two advantages of her converting to a joint stock co. c) if she wishes to grow further then which of the two option is better?
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Aarti is a sole proprietor over the past 15 years her business has gro...
Merits of Aarti remaining a Sole Proprietor

  • Easy to Start: As a sole proprietor, Aarti can start her business with minimal legal formalities and capital. She has complete control over the business and can make decisions quickly without consulting with others.

  • Less Legal Formalities: Aarti has less legal formalities to comply with as a sole proprietor. She does not have to file separate tax returns for the business, and her personal assets are not separate from her business assets.



Advantages of Converting to a Joint Stock Co.

  • Limited Liability: If Aarti converts her business to a joint stock company, she will have limited liability. This means that her personal assets will not be at risk if the business incurs losses or faces legal action.

  • Easier to Raise Capital: Aarti can raise capital easily by issuing shares to investors. This will help her to expand her business and open more branches.



Which Option is Better?
If Aarti wishes to grow her business further, it is better for her to convert her business to a joint stock company. This is because a joint stock company offers many advantages that can help her to expand her business, such as limited liability, easier access to capital, and a more professional image. However, Aarti should also consider the disadvantages of converting to a joint stock company, such as the need to comply with more legal formalities and the loss of complete control over the business. She should weigh the advantages and disadvantages carefully before making a decision.
Community Answer
Aarti is a sole proprietor over the past 15 years her business has gro...
A) 1>she has to register her firm and she has to face many regulations while converting her firm into a company
2> she has to now follow different accounting procedure if she wishes to change her convert her business
c) partnership and company can be the best option for her to manage all her work effectively and efficiently
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Aarti is a sole proprietor over the past 15 years her business has grown from operating a neighbourhood shop selling kurtis, bags, cosmetics etc. to retail chain with four branches in the branches,she is thinking to form a company to manage the business better. she also wants to grow further. a) explain two merits of Aarti remaining a sole proprietor. b) explained two advantages of her converting to a joint stock co. c) if she wishes to grow further then which of the two option is better?
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Aarti is a sole proprietor over the past 15 years her business has grown from operating a neighbourhood shop selling kurtis, bags, cosmetics etc. to retail chain with four branches in the branches,she is thinking to form a company to manage the business better. she also wants to grow further. a) explain two merits of Aarti remaining a sole proprietor. b) explained two advantages of her converting to a joint stock co. c) if she wishes to grow further then which of the two option is better? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Aarti is a sole proprietor over the past 15 years her business has grown from operating a neighbourhood shop selling kurtis, bags, cosmetics etc. to retail chain with four branches in the branches,she is thinking to form a company to manage the business better. she also wants to grow further. a) explain two merits of Aarti remaining a sole proprietor. b) explained two advantages of her converting to a joint stock co. c) if she wishes to grow further then which of the two option is better? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Aarti is a sole proprietor over the past 15 years her business has grown from operating a neighbourhood shop selling kurtis, bags, cosmetics etc. to retail chain with four branches in the branches,she is thinking to form a company to manage the business better. she also wants to grow further. a) explain two merits of Aarti remaining a sole proprietor. b) explained two advantages of her converting to a joint stock co. c) if she wishes to grow further then which of the two option is better?.
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