Business Case Study

There are similar negative aspects in a partnership that were mentioned in the sole proprietorship. There is an issue of liability that may be greater depending on the circumstances. Under certain conditions a wealthier partner or higher contributing partner may have to bear a disproportionate share of the losses if the other partners do not have sufficient personal assets (Block, et al., 2015, p. 9). In my opinion the partnership is only as good as the weakest partner. Shania would have to entrust other

The benefit of Shania setting up her business as a limited partnership is that she, being the only general partner and liable for all debt, will be the one who manages the daily operations and executive decisions for the business. Limited partners, since they are only liable for the capital the contribute, they possess no authority in regards to making important decisions for the business and other managerial responsibilities solely designated for general partners. For Marvin’s case, Shania’s husband, the formation of a limited partnership is best. Marvin only wanted to contribute to Shania’s dream, not take a great role in managing her affairs.

It sounds like her sister, Kelsey, and her neighbor, Carlos, only want an income, but if Shania does not want to figure out payroll taxes then I would consider a partnership with her sister, neighbor and her husband as a silent partner. However, if they want limited liability considering debt then an LLC would be the best one to consider. Because under the structure of an LLC, each member or partner’s liability is limited concerning the debts or legal action of the business (Meggitt, J., 2016).

They can also form a partnership, which is a type of business in which co-owners share the costs and work together to attract customers. As general partners, they would manage the business together and share profits, debts, and obligations associated with it. If Helena and Francine form a limited partnership, they could bring in other limited partners who help fund the

You are a valued colleague and friend of this trio, and they have come to you seeking advice as to how to structure their new business. Please consider the following tax and nontax issues as you recommend

In order to properly plan the business that John and his wife are considering, they will need to consult a lawyer, multiple suppliers, and the municipal authority of the area. Consulting with these professionals will clarify that their business is created in a manner that protects them from the potential legal implications of taking on a business venture of its magnitude. Consulting a lawyer first would be the way to start. Meeting with a lawyer is necessary for first deciding what type of business they should start and what type of legal protection they are looking for, which in this case a C Corp would be a great recommendation.

This memorandum outlines the various options available to the three persons in the establishment of their business. The memorandum recommends the use of the limited partnership (LP) as the most appropriate business model in the circumstances. This choice, as outlined in the memorandum herein, is informed by the special circumstances that the business is intended to be run and conducted.

Albert and Baker have considered the merits of forming the company as a general partnership, thus a co-ownership of a business for profit. Under the Uniform Partnership Act, hence a model act that codifies partnership law, Albert and Baker’s respective rights to any profits of the company would be an equal share. According to Cheeseman, “Partnership agreements often provide that profits and losses are to be allocated in proportion to the partners’ capital contributions. The right to share in the profits of the partnership is considered to be the right to share in the earnings from the investment of capital” (2007, p. 298). For instance, let’s assume that Albert contributes $50,000 capital, and Baker contributes $75,000 capital and the

This report entails a detailed analysis of how three friends should set up their business. It starts by the definition of a General Partnership (unincorporated) and Limited Liability Company (incorporated). It furthermore goes into the disadvantages and advantages of each as well as the comparison between both. It concludes with a recommendation as to how the friends should set up their business.

I am in the process of designing a business plan for a future bed and breakfast that I would like to open in a couple of years. I would like to purchase some land outside of Austin, TX in order to build this bed and breakfast. I plan on starting this company with a partner, my younger sister, Mercy. We want to know if we should start a general partnership, with both of us as a general partner, or a limited partnership, with me as the general partner and Mercy as the limited partner.

Financially speaking, the duo is better off with the 60/40 split. The S-corporation election allows for income and deductions from the business to flow down to the taxpayers. If Mr. Jones decided to stay a sole-proprietor, he claims the entire $1,200,000 on his Form 1040. If he decides to elect the S-corporation status with a 60/40 split, he claims $720,000 of the business’ income, as well as 60% of the business’

The partnership would be owned in a ratio of 60:40, me owning 60%. This means we would share the cash input and profits and losses in this ratio, which is bad in the short-term for me, but hopefully good in the long-term. A partnership brings

Tim and Tom are interested in inquiring about the possibilities of doing a small business together, a retail shop in this case. The voluntary redundancy package has left the two with $180,000 and $120, 000 respectively. Tim has minimal savings while Tom has $80,000 in bank account, while they require $500,000 for the initial setup. In order to reach a solution, a thorough exploration of all the possibilities is required, gaging every aspect and driving a particular solution.

Ultimately, a partnership would allow Coral to continue her work in the medium sized firm whilst establishing this new business, thus providing her with financial security in times of need.

All the partners can participate in the management of the business and can work for it