Is the entrepreneur liable to pay his creditors. ,Give reasons.
Study the following case/situation and express your opinion:
If the business is a sole trading concern with a capital of Rs 25,000, but the debts are amounting to Rs 50,000.
1. Is the entrepreneur liable to pay his creditors.
2. Give reasons.
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1 Answers
1. Yes, he has to pay to his creditors.
2. A sole trading concern has unlimited liability therefore, he has to pay his creditors by selling off his private property.
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