Sole proprietorship

BCL – L1 – Q95 – Legal implications relating to companies in difficulty or in crisis

Assess if selling all assets can cover liabilities for a struggling radio station.

Question

Kofi Amo set up a radio station, Amo FM, investing GH¢10,000 initial capital. After some years, the business is not successful. At the end of the fifth year, furniture and fixtures were worth GH¢5,000; the delivery van was valued at GH¢2,000, and Kofi lived in a small flat valued at GH¢50,000, which he owns. This house was mortgaged from Apex Finance, with an outstanding balance of GH¢40,000 to pay off the mortgage.

Now the business has hit hard times: rent for the office location has increased, and Kofi owes the landlord GH¢10,000; workers have not been paid for months, with salary arrears of GH¢7,000; the bank overdraft is GH¢15,000, and the bank has refused to extend it; Kofi has received a demand from the National Communication Authority to renew the license for GH¢8,000.

(a) If all of your assets were sold off, would you be able to meet all of your liabilities?

(b) What options do your creditors have? Is your home safe?

Answer

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Tags: Assets, Creditors, Judgement Debt, Sole proprietorship, Unlimited Liability
Level: Level 1

Topic: Legal implications relating to companies in difficulty or in crisis

BCL – L1 – Q61 – Alternative forms and constitutions of business organisations

Recommend whether Hajia Amina’s business should remain a sole proprietorship or convert to a private limited company.

Question

Your mother trades in locally made fruit juice in a container at the front of the house at Adiembra-Zongo. The booming business is putting pressure on her working capital. But she plans to open two new retail branches and a semi-wholesale by the end of the year using sale proceeds of her private car which will not be enough. A bank manager working on her personal loan application advised her to convert the sole proprietorship into a private limited liability company, but your mother thinks that will reduce her power and influence. She adores the business name registration certificate with her name boldly engraved ‘HAJIA AMINA SIEDU ENTERPRISE’.

(a) Which of the options will you recommend?

(b). Discuss why you would support your mother’s position or that of the bank manager.

Answer

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Tags: Advantages, Disadvantages, Limited Liability Company, Sole proprietorship
Level: Level 1

Topic: Alternative forms and constitutions of business organisations

BCL – L1 – Q53 – Alternative forms and constitutions of business organisations

List four particulars required for registration by a sole proprietor.

Question

List FOUR (4) particulars for registration with the Registrar-General by a sole proprietor.

Answer

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Tags: Business name, Legal requirements, Registration, Sole proprietorship
Level: Level 1

Topic: Alternative forms and constitutions of business organisations

BCL – L1 – Q52 – Alternative forms and constitutions of business organisations

State two advantages and two disadvantages of forming a sole proprietorship.

Question

It appears that many residents of Kumasi prefer to own their businesses without going through the cumbersome details of forming an incorporated company limited by shares.

Required:

State TWO (2) advantages and TWO (2) disadvantages of forming sole proprietorship.

Answer

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Tags: Advantages, Business structure, Disadvantages, Registration, Sole proprietorship
Level: Level 1

Topic: Alternative forms and constitutions of business organisations

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BCL – L1 – Q95 – Legal implications relating to companies in difficulty or in crisis

Assess if selling all assets can cover liabilities for a struggling radio station.

BCL – L1 – Q61 – Alternative forms and constitutions of business organisations

Recommend whether Hajia Amina’s business should remain a sole proprietorship or convert to a private limited company.

BCL – L1 – Q53 – Alternative forms and constitutions of business organisations

List four particulars required for registration by a sole proprietor.

BCL – L1 – Q52 – Alternative forms and constitutions of business organisations

State two advantages and two disadvantages of forming a sole proprietorship.

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BCL – L1 – Q95 – Legal implications relating to companies in difficulty or in crisis

Assess if selling all assets can cover liabilities for a struggling radio station.

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BCL – L1 – Q61 – Alternative forms and constitutions of business organisations

Recommend whether Hajia Amina’s business should remain a sole proprietorship or convert to a private limited company.

You're reporting an error for "BCL – L1 – Q61 – Alternative forms and constitutions of business organisations"

BCL – L1 – Q53 – Alternative forms and constitutions of business organisations

List four particulars required for registration by a sole proprietor.

You're reporting an error for "BCL – L1 – Q53 – Alternative forms and constitutions of business organisations"

BCL – L1 – Q52 – Alternative forms and constitutions of business organisations

State two advantages and two disadvantages of forming a sole proprietorship.

You're reporting an error for "BCL – L1 – Q52 – Alternative forms and constitutions of business organisations"

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