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SSC Financial and Cost Accounting P-1 QUESTION #6071
Question 1

Jamie is launching a new enterprise and has three primary requirements: he wants to receive a salary for managing the business, he desires total ownership, and he must ensure his personal assets are protected from business risks. Which business structure should Jamie select?

  • Sole trader
  • Partnership
  • Private limited company✔️
  • Public limited company
Correct Answer Explanation

A private limited company offers limited liability, protecting Jamie's personal assets. As a separate legal entity, it allows him to be the sole owner (shareholder) and receive a salary as a director. A sole trader or partnership would have unlimited liability, risking personal assets.