You Decide Business Format for Scenario
Prepare a memo that addresses the elements below.
Identify three business formations that you believe Gloria could consider as appropriate for her business.
Define each chosen business formation.
Explain at least three pros and three cons for each potential business formation.
Using the course material and the DeVry Library, research which business formation would best insulate Gloria and her family from potential liability.
Below are some more tips to help you be successful in this assignment.
The heading of your memo should be: Memo to Gloria Smithson.
Your memo should be three to four pages long, exclusive of the cover page and references page. It should comply with APA 6th edition formatting.
12-point, Times New Roman font
No website references
Include at least two scholarly references in addition to your textbook
*Include in-text references to sources
Gloria is very concerned about insulating herself and her family from personal liability. You are a business planner and accountant. Gloria has come to you to get some advice on which business entity best suits her needs and objectives. For this assignment, you will prepare a three- to four-page memo to Gloria Smithson to advise her on which business entity you recommend she choose based on her situation and your research.
You are a business planner and accountant. Your expertise is in helping clients evaluate business formation options and business strategy. You have cultivated many international contacts in a variety of fields, including manufacturing. You believe that you will be able to help Gloria find appropriate manufacturing options abroad as well as companies in several countries with which she might want to partner. You have created an extensive memorandum that outlines the various business entity options, the strengths and weaknesses of each, as well as suggestions concerning global expansion. Gloria has come to you to get some advice on which business entity best suits her needs and objectives.
Gloria regularly used widgets* in her position as a manufacturing supervisor at Energy Efficiency Ltd. An engineer by education, she spent evenings designing a newer, better, and more efficient widget that would revolutionize the energy industry. When she felt confident that she had perfected the design, she and her husband Joe fabricated a prototype. When the prototype functioned as they intended, they hired a lawyer to file design and utility patent applications. Now, 18 months later, their attorney told them that they have been granted provisional design and utility patents. Gloria is confident that she is ready to start her business, and she wants to quit her current job to do so. Gloria knows the business will start small but believes that it will grow into a multimillion-dollar company with many employees. She wants to minimize the taxes the business pays, and she wants to make sure that she and her family are insulated from personal liability for debts of the business, or liability in the event of injury caused by the widget.
Joe is Gloria’s husband. He is also an engineer and agrees with Gloria that they should start a business, but he is not willing to quit his job at this point to help Gloria. They need to have at least one steady income, and they rely on Joe’s job benefits like health insurance and his 401k. They borrowed money from Joe’s 401k to manufacture the prototype widget, and they paid the patent application fees and their attorney’s fees from those funds.
Gerald is Gloria’s father. He is retired but is willing to invest some money into Gloria’s business. However, he wants to have some control over the business and wants his investment to be considered a loan that Gloria’s business would have to repay with interest.
Nancy and Roger Forrester
Nancy and Roger are childhood friends of Joe’s. They learned about the new widget when they were at the Smithsons’ home for a BBQ and saw the prototype on the kitchen counter. They are independently wealthy and consider themselves to be venture capitalists; they invest money into new businesses they believe will be profitable. They want to invest money into Gloria’s business but don’t want to have any day-to-day responsibilities for running the business
Gloria is very concerned about insulating herself and her family from personal liability. You are a business planner and accountant. Gloria has come to you to get some advice on which business entity best suits her needs and objectives. For this assignment, you will prepare a three- to four-page memo to Gloria Smithson to advise her on which business entity you recommend she choose based on her situation and your research