In the context of accounting practices, which entity is subject to minimum obligations under company law? A) Limited liability companies B) Partnerships C) Non-profit entities D) S... In the context of accounting practices, which entity is subject to minimum obligations under company law? A) Limited liability companies B) Partnerships C) Non-profit entities D) Sole traders
Understand the Problem
The question is asking about which type of business entity has minimum obligations under company law, focusing on accounting practices. It presents four options related to different types of business entities: limited liability companies, partnerships, non-profit entities, and sole traders.
Answer
Sole traders
The entity subject to minimum obligations under company law is Sole traders.
Answer for screen readers
The entity subject to minimum obligations under company law is Sole traders.
More Information
Of all the business structures, sole traders, also known as sole proprietorships, typically have the simplest regulatory requirements. They are not separate legal entities and have fewer reporting and legal obligations under company law compared to companies, partnerships, or non-profit entities.
Tips
A common mistake is to confuse limited liability companies with sole proprietorships in terms of obligations, but LLCs are subject to more regulations.
Sources
- What Is a Sole Proprietorship? - Investopedia - investopedia.com
- Chapter 5 - Ownership and Control - USCIS - uscis.gov
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