Overall instructions:
Each section has guidelines for length and the total possible points. Please write this as if it could be handed to a client – well written, complete sentences, good grammar and punctuation, use bold headings to differentiate sections for clarity, use bullets as applicable. Single space, use Helvetica or Arial 11 or 12 font. Please get started right away – do not wait to try to do all at once in the end.
Business Entities
You have three clients that are all starting businesses and are asking your advice on what corporate form (if any) to use. Please note you are expected to do additional research and not just answer from information only in the book. You also must cite your sources.
Write out what you would tell your clients structured as overall information and advice that you will tell all three, following by specific advice for each unique client scenario.
The following questions 1 through 7 will be answered only once as it will be the overview and information that you provide all three clients regardless of their situation and scenario (so only write this part out once):
A brief overview of the legal entities that a firm can take. One to two pages 100 points
What is the relative use of each form of a business in United States and how that has changed over time (This will require research and be sure refer to and cite your sources) One to three paragraphs and chart(s) and/or graph(s). 50 points
Why would someone use an LLC instead of a S-Corporation? Include in your answer the limitations on who can own an S Corporation. Two paragraphs to a one page 50 points
What form or form of business is immediately not applicable if they want to protect their personal assets from any financial risk and explain why. 50 points
Explain how they can legally use more than one name for their firm by filing a DBA (doing business as also known as a fictitious name statement) and what that filing process entails. Approximately ½ to one page 50 points.
What business form do venture capitalists typically prefer and why? Approximately ½ page 40 points.
What business form are the companies that trade on the publicly traded exchanges (such as NASDAQ or NY Stock Exchange) and why Approximately ½ page 40 points.
Note: 1 thru 7 above you only need to write out once at it will be the same for each scenario.
The following questions you will do each one three times – one answer per question for each Scenario A, B and C.
Scenario A: Three engineering graduate students have developed a new technology that has huge promise for energy storage. They plan to file for a patent and will need to raise money to fund the development of the prototype and subsequent launch of the product.
What corporate or business form you recommend that they use given their circumstances and why it is the best for their situation. 2/3 to one page 100 points
What a possible alternative form may be and compare and contrast the two options. One to 1 ½ pages (can use charts as well) 100 points
Scenario B: This client has been running their own business providing bicycle repair and tune-up services to corporations who in turn offer that as an employee benefit for their staff. The business is one year old and the client wants to open another branch in another city which will be run by someone else, and if that goes well will expand into additional cities. As it grows he would like to offer the managers at the various locations slight ownership in the firms as an incentive.
What corporate or business form you recommend that they use given their circumstances and why it is the best for their situation. 2/3 to one page 100 points
What a possible alternative form may be and compare and contrast the two options. One to 1 ½ pages (can use charts as well) 100 points
Scenario C: The client and their partner wants to buy an existing restaurant.
What corporate or business form you recommend that they use given their circumstances and why it is the best for their situation. 2/3 to one page 100 points
What a possible alternative form may be and compare and contrast the two options. One to 1 ½ pages (can use charts as well) 100 points
