Jasmine Sparks has just finished a clothing design program at one of the local colleges, where her instructors praised her creativity. Each year, clothing designed by the students is sold to the public. As her designs sold very quickly, Jasmine is considering starting her own company to design clothing for teens. She realizes that she will need some financial backing to get started.
Required:
a. What advantages and disadvantages are there to setting up her business as a sole proprietorship?
b. What advantages are there to beginning operations as a sole proprietorship and then switching to a partnership when she expands?
c. What advantages and disadvantages are there to operating as a corporation?
d. Which form of business organization would her customers likely prefer? Why?
e. Which form of business will be most advantageous to her if she wants to maintain control as the business expands? Why?