Explain the difference between a sole proprietorship and a corporation for financing.

Explain the difference between a sole proprietorship and a corporation for financing.

• A. Sole proprietorship has limited liability; corporation has unlimited liability.
• B. Sole proprietorship is a separate legal entity; corporation is owned by one person.
• C. Sole proprietorship is owned by one person with unlimited liability; corporation is separate legal entity with potential for easier financing and limited liability.
• D. Both have identical financing options.

Answer: (C)