What is the principal claim of the owner of a business called?

The principal claim of the owner of a business, commonly denoted in accounting and finance, is referred to as proprietorship. This term encompasses the ownership rights and obligations that an individual, typically a sole proprietor or partnership, has in a business. Proprietorship reflects the total value of what the owner has at stake in the enterprise, which includes all the assets and liabilities associated with the business.

In contrast, investment generally refers to the money or resources put into the business and does not capture the concept of ownership claim directly. Equity, while similar, typically denotes the ownership interest in a corporation and could involve shares, rather than being exclusive to sole proprietorship contexts. Net profit denotes the revenue left after all expenses have been deducted, but it does not encapsulate the owner’s claim or interest in the business itself. Thus, the term proprietorship most accurately describes the specific claim of the owner in the context of business ownership.