Chapter 9
1) My biggest surprise in the reading was how highly liable sole proprietorships were. If anything goes wrong in a sole proprietorship the CEO of the business is directly responsible and the courts can seize their personal assets. I now understand why business choose to incorporate; if something goes wrong the CEO/other higher ups will not be personally liable, and their assets cannot be taken away.
1) My biggest surprise in the reading was how highly liable sole proprietorships were. If anything goes wrong in a sole proprietorship the CEO of the business is directly responsible and the courts can seize their personal assets. I now understand why business choose to incorporate; if something goes wrong the CEO/other higher ups will not be personally liable, and their assets cannot be taken away.
2) The
one part of the reading that confused me was the part about bankruptcy and the
Bankruptcy Act. Going bankrupt does not mean the business is actually out of money,
and some businesses actually declare bankruptcy in order to help their business
(aka Donald Trump). The business definition of bankruptcy is very different
from the typical definition of bankruptcy so that is confusing.
3) Two
questions I would ask the author are:
a. What
are some examples of businesses that have benefited from declaring bankruptcy?
b. Why
are LLC’s needed?
4) There
was nothing I thought the author was wrong about in this section. This section
was very factual and informative, therefore, there is very little that can be
argued for being wrong.
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