Description
Prior to beginning work on this assignment, read Chapter 13 of the textbook.
In your analysis,
Explain, if you were to start your own business, which business entity structure you would choose.
Justify why your chosen structure is the best organizational form.
Explain the following business structures: sole proprietorship, partnership, LLC, and a corporation.
Analyze the following for each business structure:
steps to form
personal liability for owners
taxation
advantages and disadvantages
The Business Organization paper
must be three to five double-spaced pages in length (not including title and references pages) and formatted according to APA Style as outlined in the Writing Center’s APA Formatting for Microsoft Word resource.
must include a separate title page with the following:
Title of paper in bold font
Space should appear between the title and the rest of the information on the title page.
Student’s name
Name of institution (The University of Arizona Global Campus)
Course name and number
Instructor’s name
Due date
must utilize level headings to organize the paper. See the APA Style Elements resource for assistance.
must utilize academic voice. See the Academic Voice resource for additional guidance.
must include an introduction and conclusion paragraph. Your introduction paragraph needs to end with a clear thesis statement that indicates the purpose of your paper.
For assistance on writing Introductions & Conclusions and Writing a Thesis Statement, refer to the Writing Center resources.
must use at least two credible and/or scholarly sources in addition to the course text.
The Scholarly, Peer-Reviewed, and Other Credible Sources table offers additional guidance on appropriate source types. If you have questions about whether a specific source is appropriate for this assignment, please contact your instructor. Your instructor has the final say about the appropriateness of a specific source.
To assist you in completing the research required for this assignment, view Quick and Easy Library Research tutorial, which introduces the University of Arizona Global Campus Library and the research process, and provides some library search tips.
must document any information used from sources in APA Style as outlined in the Writing Center’s APA: Citing Within Your Paper guide.
must include a separate references page that is formatted according to APA Style as outlined in the Writing Center.
See the APA: Formatting Your References List resource in the Writing Center for specifications.
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The Final Paper Proposal paper
Norma Becerra
University of Arizona Global Campus
Business Law I
Leah Ruby
11/05/2023
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Introduction
Just two years ago, Acme Fireworks had its humble beginnings in the owner’s garage.
Under your leadership, the company has grown from a struggling fireworks wholesaler to a
successful retailer and manufacturer of displays (with 15 workers). A single person started the
firm, but when demand increases from corporate clients for repeat fireworks shows, he must
make a critical choice. These are severe queries from businesses that have indicated an interest
in entering into long-term contracts at predetermined rates. While specifics were not provided,
it was established that the most expensive parts of fireworks shows are the professional labor,
insurance, and the actual execution of the service (Aznavi, 2020). As the business owner, you
are probably concerned about whether or not the company can afford to take on additional
employees if its high volume of orders suddenly drops. Therefore, the company’s owner is
considering a change in the company’s entity structure in order to better deal with these
uncharted seas.
Evaluation of Business Entity Options
The owner of Acme Fireworks needs to decide what kind of company entity to use, and
doing so is an essential first step. The company’s legal, financial, and operational structures
may all be affected by the entity chosen. The key alternatives include continuing as a sole
proprietorship, setting up a partnership, creating an LLC, or converting to a corporation. There
are benefits and drawbacks to every possible company structure (Murphy, 2019). The simplest
business structure is that of a sole proprietor, which entails personal liability and direct control
of the business. Partnerships can be beneficial because of the ability to divide labor and costs,
but they can present difficulties in interpersonal interactions. LLCs blend limited liability with
operational flexibility, making them a popular choice for many small enterprises. Although
more challenging to form, corporations provide substantial liability protection and immense
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expansion opportunities. This choice will cause far-reaching consequences for the organization,
so it is essential to weigh the benefits and drawbacks of each option thoroughly.
Recommendations for Business Entity Selection
The best choice of legal structure for Acme Fireworks can be made after carefully
considering the owner’s objectives, fears, and hopes for the company’s future. The owner’s goal
is to land sizable, ongoing contracts for fireworks shows; therefore, prudent risk management
and financial security will be essential. Converting to an LLC is a sensible option because of
the company’s likely expansion and subsequent need to increase its workforce. An LLC is the
best option since it combines protection from personal liability with adaptability in business
decisions. It allows flexibility to meet the demands of an ever-evolving market without
exposing the owner’s assets to the risks of business debts and liabilities (Naumova, 2021). If
the company grows, it will be able to hire more people, and this structure will enable them to
become members or equity investors. Given its flexibility, an LLC is an excellent option for
expanding into new markets and expanding operations.
Process of Forming the Recommended Business Entity
Choosing a business name that satisfies state rules is the first step in converting to an
LLC. A registered agent must be selected to accept legal notices and act as the company’s
contact person. Articles of Organization, a foundational document detailing the LLC’s form and
operation, are filed with the state’s Secretary of State office. Bringing in an Employer
Identification Details throughthe IRS is vital for tax purposes and employing staff. Its state of
incorporation may also require Acme Fireworks to create an Operating Agreement outlining its
management structure and business practices (Li, 2021). The liability shield and expansion
opportunities provided by an LLC structure are crucial to any company’s long-term success,
and this comprehensive guide makes the transfer as easy as possible (Ng, 2021). Constant
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vigilance, adherence to legal and financial issues, and consulting with legal and financial
specialists to ease the transition are all essential.
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References
Aznavi, S., Fajri, Shadmand, M. B., & Khoshkbar-Sadigh, A. (2020). Peer-to-peer operation
methodsof PV-equipped office buildings and charging stations looking at electric
vehicle energy pricing. IEEE Transactions on Industry Uses, 56(5), 5848-5857.
DOI: 10.1109/TIA.2020.2990585
Li, X., Lyu, Wang, Z., Chen, C. H., & Zheng, P. (2021). Assesing knowledge graphs in
industrial products: survey of main aspects, challenges, and future perspectives.
Computers in Industry, 129, 103449. https://doi.org/10.1016/j.compind.2021.103449
Murphy, G., Tocher, N., & Burch, T. (2019). Small business owner persistence: Do personal
characteristics matter?The Journal of Small Business Strategy (archive only), 29(1),
99–114. https://libjournals.mtsu.edu/index.php/jsbs/article/view/1193
Naumova, O. A., & Tyugin, M. A. (2021). Information and analytical assistance for enterprise
business management. Current achievements, challenges and digital chances of
knowledge-based economy, 295-303. https://doi.org/10.1007/978-3-030-47458-4_35
Ng, K., Chen, C. H., Lee, C. K., Jiao, J. R., & Yang, Z. X. (2021). A systematic review on
intelligent automation: Aligning ideas from theory, practice, and future perspectives.
Advanced
Engineering
https://doi.org/10.1016/j.aei.2021.101246
Informatics, 47,
101246.
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