Hudson Signs, Inc., needs funds, and Alley Hudson, the president, has asked you to consider investing in the business. Answer the following questions about the different ways that Hudson might organize the business. Explain each answer. a. What forms of organization will enable the owners of Hudson Signs, Inc., to limit their risk of loss to the amounts they have invested in the business? b. What form of business organization will give Alley Hudson the most freedom to manage the business as she wishes? c. What form of organization will give creditors the maximum protection in the event that Hudson Signs, Inc., fails and cannot pay its debts?
Hudson Signs, Inc., needs funds, and Alley Hudson, the president, has asked you to consider investing in the business. Answer the following questions about the different ways that Hudson might organize the business. Explain each answer. a. What forms of organization will enable the owners of Hudson Signs, Inc., to limit their risk of loss to the amounts they have invested in the business? b. What form of business organization will give Alley Hudson the most freedom to manage the business as she wishes? c. What form of organization will give creditors the maximum protection in the event that Hudson Signs, Inc., fails and cannot pay its debts?
Chapter13: Choice Of Business Entity—general Tax And Nontax Factors/formation
Section: Chapter Questions
Problem 34P
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Question
Hudson Signs, Inc., needs funds, and Alley Hudson, the president, has asked you to consider
investing in the business. Answer the following questions about the different ways that Hudson
might organize the business. Explain each answer.
a. What forms of organization will enable the owners of Hudson Signs, Inc., to limit their
risk of loss to the amounts they have invested in the business?
b. What form of business organization will give Alley Hudson the most freedom to manage the business as she wishes?
c. What form of organization will give creditors the maximum protection in the event that
Hudson Signs, Inc., fails and cannot pay its debts?
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