Question

A business where an individual is both the owner and conductor of the business affairs is called

• A. Proprietorship Firms
• B. Partnership Firms
• C. Private Limited Company
• D. None of the above

Answer 1

The Correct Option is A

The question asks about a type of business structure where an individual is both the owner and the conductor of business affairs. To determine the correct answer, let's analyze the given options:

1. Proprietorship Firms:
   • A proprietorship, or sole proprietorship, is a business that is owned, managed, and operated by a single individual.
   • The owner is solely responsible for the profit and loss of the firm, and there's no distinction between the business and the owner.
   • Since a sole proprietor conducts the business affairs personally, this matches the description in the question.
2. Partnership Firms:
   • A partnership is a business structure where two or more individuals manage and operate a business in accordance with the terms set in a formal agreement.
   • Thus, this does not satisfy the condition of a single individual being both the owner and manager.
3. Private Limited Company:
   • A private limited company is an incorporated business entity with limited liability and requires at least two members.
   • Ownership is divided into shares, and its management is conducted by a board of directors, not a single individual in most cases.
4. None of the above:
   • This option can be considered if no other option fits the question, which isn't the case here.

Based on the explanation above, the correct answer is Proprietorship Firms. This business structure perfectly matches the condition that an individual is both the owner and the manager of business affairs.