“ On account of a number of losses, the personal properties of a Sole Proprietor can be used for repayment to the creditors.’’
( a ) To which of the characteristics of Sole Trade does this statement relate ?
( b ) Also explain two other characteristics

Dear student, 

a) The characteristic of sole trade that is being described is 'unlimited liability'. Unlimited liability implies that the personal assets of the proprietor can be uses in case the business assets fall short of the debt repayment. 

b) Two other characteristics of sole proprietor are:
  • No legal formalities are required for opening or closing down a close proprietorship business. 
  • The sole proprietorship business has no separate legal identity from its own. 

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