Question

Jennifer and Jamie are starting a business and have asked you for advice about whether they should form a partnership, a corporation, or some other type of entity. Prepare a list of questions you would ask in helping them decide which type of entity they should choose. Explain your reasons for asking each of the questions.

Answer 1

Let us understand the definition to shoot the question for better understanding.

Explanation:

Sole Proprietorship:

• Owned by single person
• One person responsible for liable and business
• Simple to form
• Nominal cost

Corporations:

• Legal entities
• Shared by shareholders
• More complex type
• Used for large business

Partnership:

• Shared by two or more people
• Types :general partnerships, limited partnerships, joint ventures

Questions: (reason not required as you can self-understand)

• Are you going to own by oneself or shared?
• Can you manage if you own with oneself?
• What is your budget?
• Do you want to make simple legal procedures?
• Which type of partnership you prefer?
• Do you now the "pros and cons" of each one?