Let’s Be Partners
1.
What are the advantages and disadvantages of running a business as a partnership?
Some advantages of running a business as a partnership include shared expertise and workload, increased financial resources, and shared risk. Different skills and experiences are brought to the business when there are partners involved. Partnerships also allow business owners to share the cost of financing their business and potentially raise more capital than if they were the only owner. The risk and financial burdens are spread when there are multiple partners, which reduces the individual liability. Some disadvantages of running a business as a partnership include shared profit
and shared decision-making.The partnership agreement requires partners to share profits among themselves, which can lead to conflicts if the division of profits is not clearly outlined. Additionally, major decisions need to be agreed upon by partners, which can hinder decision-making and lead to disagreements.
2.
What other legal types of organization could have been used for the business described ? Which form would you recommend? Why?
Some other legal types of organization that could have been used for the business described include sole proprietorship, limited partnership, limited liability partnership, and limited liability company. In this situation, considering the concern regarding joint and several liability, Gary
and Jerry should consider creating an LLC (limited liability company) or an LLP (limited liability partnership). Both of these options will give Gary and Jerry limited liability protection while still allowing them to retain control and be actively involved in the business.
