TEP 1 Read this prompt There are three friends who have decided to start a business together They want to develop and sell toys They are trying to figure out which structure or association type their business should be Here are their wishes and concerns All three persons will be involved with the day to day management of the business They want pass through taxation (i e , they do not want the income from the business to be taxed twice) None of them want to have any personal liability when it comes to the business They are concerned about the possibility of getting sued if a child ever gets hurt playing with one of their toys STEP 2 Give your recommendation Assume that you are either (A) one of the friends who will be starting this business or (B) a lawyer hired by the business Make a recommendation as to which structure or association you think is best for this business based on the facts above State the reasons for your position There will also be some disadvantages to the business structure or association you choose Identify at least one negative and suggest how you might minimize it

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 06, 2024

TEP 1 - Read this prompt. There are three friends who have decided to start a business together. They want to develop and sell toys.

TEP 1 - Read this prompt.

There are three friends who have decided to start a business together. They want to develop and sell toys. They are trying to figure out which structure or association type their business should be. Here are their wishes and concerns:

- All three persons will be involved with the day-to-day management of the business.
- They want pass-through taxation (i.e., they do not want the income from the business to be taxed twice).
- None of them want to have any personal liability when it comes to the business. They are concerned about the possibility of getting sued if a child ever gets hurt playing with one of their toys.

STEP 2 - Give your recommendation.

Assume that you are either (A) one of the friends who will be starting this business or (B) a lawyer hired by the business.

1. 1. Make a recommendation as to which structure or association you think is best for this business based on the facts above. State the reasons for your position.
  2. There will also be some disadvantages to the business structure or association you choose. Identify at least one negative and suggest how you might minimize it.