Hi Cassie, you are right. Technically a sole proprietorship isn't a corporation. First of all, a corporation is multiple people. Also, a whole corporation cannot go to jail per say, however, a sole proprietor surely can. I believe the reason why the sole proprietorship was grouped in the lecture to be a type of corporation is because it is essentially a "make-shift" corporation. It has all the other criteria of what the perks of a corporation are. Both a corporation and sole proprietor can hire others, borrow or loan money, pay taxes, be sued or sue, and have assets. I think its like one of those square/ rectangle type of rules - Where a square can be considered a rectangle according to geometric laws, but a rectangle cannot be  defined as a square. Its just technicalities that separate a sole proprietorship from a corporation. There are enough similarities between the two to consider a sole proprietorship to fall under the umbrella of a corporation.  

Right off the bat, if you were to google what is a corporation, you would see "a legal entity that is separate and distinct from its owners" or "an organization  - usually a group of people". This involves creating a collection of many individuals to hire, become managers, and be involved with a business where many people are involved in the direction an org is going in. A sole proprietorship is a business that involves only a single human being taking the brunt of the expenses, profits, and legal battles to defend the company. I agree with you Sheila where in a sense, a sole proprietorship vs. a partnership all have the same abilities as the others to promote their business and have many similar capabilities to a larger corporation. It's just that having more people "in charge" allows for the decision-making and drawbacks to be split amongst them all. Interestingly enough, a Limited Liability Company, many of which are known to have a plethora of members attached, can also be owned by a singular person. The only difference here is that they would have to register with the state their business is based in. It all depends on how comfortable one is when creating their business in trusting the people they decide to partner with. 

Interesting points, everyone. While I agree that a sole proprietorship isn’t a corporation, it’s crucial to highlight that the key difference stems from the concept of liability and how the business is treated legally. In a corporation, owners (or shareholders) have limited liability, meaning they’re only responsible for the amount they’ve invested. If something happens—say the business accrues debt—personal assets remain protected. A sole proprietorship, however, doesn't have this shield. The owner's personal assets are directly tied to the business.

It’s worth noting that, like corporations, sole proprietorships can hire employees, pay taxes, and generate profits. But they lack the 'corporate veil' that prevents creditors from going after personal funds. Perhaps the similarity between the two structures in terms of operational aspects—like managing assets, taking loans, and even getting sued—might have led to the confusion or misinterpretation during the lecture.

Hi Cassie, you are absolutely correct. A sole proprietorship is indeed an unincorporated personal business, not a corporation. A sole proprietorship is essentially an extension of the individual who owns it. There’s no legal separation between the owner and the business, which means the owner is personally liable for all debts and obligations. The fundamentals of this are different from a corporation, as the business is a separate legal entity from its owners, offering limited liability protection.

I think this was included in the lecture to emphasize the importance of understanding different business structures and their implications, especially regarding liability and risk. The lecture likely aimed to show how sole proprietorships, though simple to set up, offer no protection from personal liability. In contrast, corporations, which are considered "legal persons" under the law, provide a level of protection through the corporate veil. This veil limits the financial risk to the amount invested in the corporation, keeping personal assets safe.