Question 1
S Corp is the most appropriate since the owners would deduct the losses incurred on the business from their (significant) income and still enjoy limited liability. There would be a probability that the owners would avoid challenges by an S Corporation restraints, only a single stock class, for instance, but the technicalities entailed in the formation and maintenance of an S Corporation could be overwhelming. Just as is the case with numerous current start-ups, there is a probability that the Maven Court would be an LLC (Heizer & Render, 2014).
Question 3
The court ruled in favor of the FCC because, under the Delaware law, a limited partnership is fully formed once the limited partnership certificate if filed (Davani, 2014).
Question 4
Yes, she ought to have bought it since Rocky Mountain was permitted to change systems by the agreement. In this case, the decision was not wrong or unethical but instead, was in good faith unlike lousy faith which entails evasion or subterfuge of contractual duties (Heizer & Render, 2014).
Question 5
S Corporations are established by the IRS and are untaxable entities. Closed Corporations, on the other hand, are set by state law. They can or cannot also be S Corps but are subjected to restricted regulation as compared to C Corps (Davani, 2014).
Chapter 29
Question 1
The corporate veil was pierced by the appeals court which ruled that the shareholder is liable since it had disregarded the corporate formalities, it had grossly insufficient capitalization and was actively taking part in the performance of the business (MARSON, 2018).
Question 3
Yes, the incorporation in Delaware has a variety of advantages.
Question 4
The court concluded that Alfred had taken part in self-dealing, which was a bleach to his fiduciary role to Saginaw. Since he was the sole director and shareholder, no disinterested parties were there to approve the agreement. He was therefore ordered by the court to make rent money refunds to the business which was supposed to pay Eve (MARSON, 2018).
Question 5
Even in a case when the plan was wrong, it accomplished the requirements of acquiring a rational business objective. The shareholders would have a successful suit if there had been instances of self-dealing as part of the board or if an uninformed decision had been made (Abbott, Pendlebury & Wardman, 2013).
General Question
Apparently, it was in the belief of Kuhn that, because the debts were under the ownership of the partnership and had been accrued as a result of certain dishonest and uninformed acts and undertakings by one of his partners, he ought to have faced a penalty and paid some fees as damages. In such a case, one should take into considerations a variety of factors in the analysis of whether the decision was ethical. One of the elements to take into account was who the shareholders were, who was hurt by the decision and who benefitted from the move. One should also consider if there were any alternatives and whether there was a chance for Kuhn to have worked on the deal with his creditors. Consequently, one should even think of the results or consequences of the implemented alternatives, whether it would his wish for everyone to be aware and whether his reputation would be tarnished by this choice and decision. One should also consider the likely consequences, assess the alternatives that would bring the most significant good or the minimal harm to the most individuals, whether the choices were in violation of the Golden Rule and whether he would be delighted if a person who owed him some cash applied the same decisions or steps (MacIntyre, n.d.).
References
Abbott, K., Pendlebury, N., & Wardman, K. (2013). Business law. Andover: Cengage Learning.
Davani, H. (2014). Globalization, Global Corporation and Government Corporation. SSRN Electronic Journal. http://dx.doi.org/10.2139/ssrn.2489650
Heizer, J., & Render, B. (2014). Operations management. Boston: Prentice Hall.
MacIntyre, E. Business law.
MARSON, J. (2018). BUSINESS LAW. [S.l.]: OXFORD UNIV PRESS.
