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Acme Fireworks

In: Business and Management

Submitted By Dinky8132
Words 984
Pages 4
Final Paper Proposal
James Collier
BUS311: Business Law I
Instructor: Daniel Malvin
9-1-2014

A sole proprietorship is a one-person business that is not registered with the state as a corporation or a limited liability company (LLC). The owner of the Acme Firework is a sole proprietor that has never changed his business entity. A sole proprietor can be held personally liable for any business-related obligation. This means that if your business doesn't pay a supplier, defaults on a debt, or loses a lawsuit, the creditor can legally come after your house or other possessions. Product liability laws cover consumer goods and goods used at a workplace. If someone is injured by a defective product or suffers loss or damage to private property, they can sue for damages. Both producers and distributors can also face prosecution if they offer unsafe products for sale. When a defective product causes injury, the manufacturer of the product, the distributor, the wholesaler and the retailer who sold the product may all be liable to the plaintiff. Several large retailers have sent inquires about the company’s ability to fill large orders on a regular basis, but the owner is anticipating he will need new employees and is worried that he will not be able to pay the employees if the large orders do not continue. The owner will have to consider a business entity because the company is going to grow with more employees and workloads. To get the most out of a small business, a company will have to choose the right structure it will maximize a company’s chances of financial and operational success. An LLC is a hybrid between a partnership and a corporation. Members of an LLC have operational flexibility and income benefits similar to a partnership but also have limited liability exposure. While this seems very similar to a limited partnership, there are significant...

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