Advise on what you consider would be the appropriate business structure, and why, for Peter and Melina
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Peter and Melina have developed a plan for a new business operating a horse training
business. Peter has been quite successful in his previous job and is concerned about
risking any of his assets. Advise on what you consider would be the appropriate
business structure, and why, for Peter and Melina
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- Jeremy is thinking of starting up a small business selling NASCAR memorabilia. He asks his friend, Carmen, if she'd like to join him in setting up a partnership to start the business. What is one disadvantage in joining the partnership that Carmen should consider? (A) Carmen should realize that profits in the partnership will be reduced by dividend payments to shareholders. B) Carmen should realize that, as an owner of the business, she will be personally responsible for the debts of the business. Carmen should realize that the profits of the business will also be taxed as dividend income, so she faces the potential for double taxation of that business income. D Carmen should realize that the Jeremy will have complete control over the business because it was his idea. CLuke is currently facing some financial difficulties, however, Luke owned land and building valued at $12 million dollars. Lorna, a good friend and skilled investment analyst is advising Luke to sell his house and invest the money otherwise e.g. in securities. This means he would be much wealthier taking such an action. Before taking the decision to sell his property and to start living in a rented house , Luke has decided to consult with you to present to him, strong arguments to support the idea of selling his property. Required Give Luke your advice from an investment perspective.Luke is currently facing some financial difficulties, however, Luke owned land and building valued at $12 million dollars. Lorna, a good friend and skilled investment analyst is advising Luke to sell his house and invest the money otherwise e.g. in securities. This means he would be much wealthier taking such an action. Before taking the decision to sell his property and to start living in a rented house , Luke has decided to consult with you to present to him, strong arguments to support the idea of selling his property. Required Give Luke your advice from an investment perspective. N.b just 5 salient points explained nothing else.
- Dawn is a director of the Manello Corporation. Bert, a friend of Dawn's and an inventor, creates a new product. Bert wants Manello to handle the production and marketing of this new product, so Bert discusses his new invention with Dawn. Dawn thinks the new invention will be a huge success, but in order to maximize her personal income, Dawn suggests to Bert that she handle the manufacturing and marketing, leaving Manello out of it completely. Bert agrees. Discuss the propriety of Dawn's actions in this situation. Would the outcome be any different if Dawn were merely a shareholder owning 4 percent of Manello? Please solve and analyze this case. use facts, issue, analysis conclusion. What would be the likely outcome in court.?Kate and Mark, a married couple, own a limited liability company. Although Kate and Mark are not yet ready to retire, they would like to begin involving their three children in the business since they are now all responsible adults. Their primary concern is ensuring that the business will remain in their family for future generations. It is also important to Kate and Mark that their children learn the value of a dollar, so they would like them to purchase their interests in the company. Kate and Mark have been successful in their business and have a modest estate, but they do not predict they will owe any estate tax. Which one of the following is the most appropriate form of business transfer technique for Kate and Mark to use to achieve their objectives? A)A preferred stock recapitalization of the business B)A gift of the business interests from Kate and Mark to each child C)A cross-purchase buy-sell agreement between Kate, Mark, and the children D)An entity…Joe is interested in purchasing a café in Hillcrest, primarily catering to the student market. Assume that Joe’s parents are likely to invest in the business and may play a management role. Describe the major characteristics, as well as listing the advantages and disadvantages, of any three forms of business structure appropriate to carrying on this business.
- Because Natalie has been successful with Cookie Creations and Curtis has been just as successful with his coffee shop, they both conclude that they could benefit from each other's business expertise. Curtis and Natalie next evaluate the different types of business organization, and because of the advantage of limited personal liability, decide to form a new corporation. Curtis has operated his coffee shop for 2 years. He buys coffee, muffins, and cookies from a local supplier. Natalie's business consists of giving cookie-making classes and selling fine European mixers. The plan is for Natalie to use the premises Curtis currently rents as a location for her cookie-making classes and demonstrations of the mixers that she sells. Natalie will also hire, train, and supervise staff hired to bake cookies and muffins sold in the coffee shop. By offering her classes on the premises, Natalie will save on travel, and the coffee shop will provide one central location for selling the mixers.…Farah and David decide to form a sports memorabilia retail partnership. They have known each other since business graduate school and have always worked well together on various projects. The business is doing well but cash flow is very tight. Farah takes several calls from vendors asking for payment. He believed David had been paying the bills. When he asks about this, David admits to embezzling from the partnership. What liability does Farah face as a result of the theft? Are you for or against a partnership? Please explain.Dr. Brown was involved in a friend's business, Mining - co. Dr. Brown was hesitant to get involved with this adventure, as he preferred to invest in real estate as opposed to securities. In fact, this investment represented Dr. Brown's only investment in securities. When he made this investment, he intended that it be a long-term one. Dr. Brown's role with Mining-co was to help with office administration and serve as a director of the company. He was not directly involved in any share offerings or other financial matters for the company. When Mining-co was originally established in 20X2, Dr. Brown purchased 50,000 shares through a private placement. Six months later he purchased 50,000 more. Dr. Brown drew down his shareholder loan in the medical practice to finance the purchases. In 20X3, Dr. Brown had approximately 25 sales of his Mining-co shares. Dr. Brown reported the gains from these sales as capital gains in his 20X3 tax return. CRA recently issued an assessment taxing these…
- Sebastian, Wyatt, and Mathew are close friends who graduated with master's degrees in accounting from an Ivy League institution. Instead of seeking employment, the friends decided to create their own accounting business. At their initial meeting, the friends could not decide whether to fom a partnership or a limited liability company. You were approached as a company law student for advice on the type of business that would be appropriate for the friends. What kind of business would you suggest to the friends? Justify your recommendation. Your reasoning should not be more than 500 words and should cover the following points: i. The requirement for the registration of the business in Jamaica ii. The advantages and disadvantages of the business type iii. Information on the dissolution of the business. Assume the friends opted to create a partnership, and has asked for your assistance in creating a Partnership deed; create a partnership deed that includes at least six terms that the…Jeremy has worked for a large lawn care company for several years. This lawn care company is located in a sunny climate, providing a stable demand year-round. After receiving an Associate's degree in Business, Jeremy decides that he would like to start his own lawn care service. He is considering if it would be best to start a sole proprietorship or a partnership. Jeremy is considering asking either his father or a co-worker at the current company he works for to be a partner in his new lawn care company. Describe the advantages and disadvantages of a sole proprietorship and partnership in this scenario.Erik is the sole owner of a small business that he started 20 years ago. Although he is not yet ready to retire, he is beginning to wonder about what would happen to the business should he die or decide to retire. Erik has a son who has graduated from college and worked at the firm for a few years. His son seems to enjoy the business and have a natural aptitude for the work. Erik is also concerned about maintaining a significant income from the business and, if possible, freezing the value of the business for estate tax purposes. Erik has already used his available applicable credit amount. Which one of the following is the most appropriate form of business transfer technique for Erik to use to achieve his objectives? A) Selling the business to the son on an installment sale basis, with the payments secured by the business assets B) A preferred stock recapitalization in which Erik retains stock that pays a noncumulative dividend and that has a fixed liquidation value,…