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Finance Assignment - Solved

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Added on  2020-05-11

Finance Assignment - Solved

   Added on 2020-05-11

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Running head: FINANCEFinanceName of the StudentName of the UniversityAuthor’s Note
Finance Assignment - Solved_1
1FINANCETable of ContentsAnswer to Question 1......................................................................................................................2Answer to Question 2......................................................................................................................3Answer to Question 3......................................................................................................................4References........................................................................................................................................5
Finance Assignment - Solved_2
2FINANCEAnswer to Question 1In today’s business organizations, bankruptcy is considered as one of the major form ofbusiness failure. Bankruptcy refers to a particular process that allows the consumers or thebusinesses to repay their debts. In the recent years, it can be seen that the number of bankruptcyof businesses in United States has increased massively (Biddle, Ma & Song, 2016). However,there is a particular reason for the bankruptcy of so many businesses irrespective of the types oftheirindustry. There are many instances of bankruptcy for the sole proprietorship business inUnited States. Sole proprietorship refers to particular type of business where the owner of thebusiness is a natural person and there is not any legal distinction between the owner and thebusiness entity. Hence, the process of bankruptcy has some major negative impacts on thebusiness of sole proprietorship. In case of a sole proprietorship business, there is not any legaldistinction between the owners of a sole proprietorship business and the business entity(Telipenko & Zakharova, 2014). In most of the cases of the bankruptcy of sole proprietorshipbusiness, it has been seen that the owners of sole proprietorship entities file their personalbankruptcy at the same time of the bankruptcy. The main reason behind the filing of personalbankruptcy is to save their personal properties like house, cars and others to pay the debts of thecreditors of their businesses. Most of the time of establishment of the business of soleproprietorship, the owners are misguided by informed that their personal assets will not beliquidated or touched to pay the debts of the creditors in case of bankruptcy. However, in actual,it does not happen in most of the ccases as the authority has the right to sell the owner’s personalassets like home, cars or others to repay the amounts of the creditors at the time of bankruptcy.This is the major effect of the bankruptcy of the business of sole proprietorship on their owners.This happens due to the reluctance of the owners of sole proprietorship businesses to take
Finance Assignment - Solved_3

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