Business Entities Final

The First Scenario:

Lou and, Jose, are considering opening a restaurant and sports bar, fully equipped with large

televisions throughout the bar area so that customers of the establishment can not only watch

sporting events and socialize. Because both Jose and Lou do not have all of the money they need

to get the business up and running, they bring in an investor to provide only the capital to start the

business and in return the investor, Miriam, will own a percentage of the organization. Because Lou,

Jose, and Miriam are all going into business together the type of business entity that would be

the best choice for the three business partners would be to enter into a partnership entity (NOLO Law for All, 2012).

Because the three business partners entered into the business, each partners personal assets is

protected against acts that would considered to be wrong or unlawful. Jose and Lou would be the

the partners that are more hands on and fully involved in the daily operations of the restaurant and

sports bar, and because of this their liability is unlimited; Miriam's liability, however, is very limited

because she is only an investor and is not as hands on as Jose and Lou are and Miriam is not

responsible for the daily operations of the organization (NOLO Law for All, 2012).

All individuals involved in the partnership of the organization are required by law to pay the due

taxes on a business after the profits of the business of the business are divided evenly amongst the

partners of the business. Once the profits have been evenly distributed it is the responsibility of each

individual partner to pay his or her share of the taxes on the business (NOLO Law for All, 2012).

To get the restaurant and sports bar up and running Lou and Jose must take into

consideration not only their social and legal responsibilities they face opening a new restaurant as well

as a sports bar serving alcoholic beverages in their establishment, but they must also apply for

all local and state business licenses to open, operate and conduct business, they must also

apply for licenses to permit their establishment to serve alcoholic beverages and display these

licenses and permits in a manner in which it is visible to the patrons of the establishment (Greene, 2012).

With any business venture, Jose, Lou and Miriam could risk losing the money they have invested

into the organization, and although Lou and Jose stand to lose, because Miriam is the largest investor

she runs the risk of losing everything she has invested into the starting of the organization. When

entering into a business partnership it is vital that each partner can be trusted to do what is right when

venturing into a business together. In order to protect each partner in this business venture, they should

each enter into a written agreement that each partner will share in all of the