Question.5459 - You are a business consultant. Angel and Maris are budding entrepreneurs who are creative, charismatic, and energetic. However, they lack knowledge of business structures and an understanding of how to balance risk and efficiency in organizing a business. They have invented a unique wearable AI app that can be added to a “smart” watch or built into a wrist or ankle bracelet to monitor and track the wearer’s pulse rate, body temperature, and blood pressure and report the data to the user’s designated healthcare provider or other third party as the user chooses, as well as analyze the data over designated time periods. They are calling this app “MvMe.” Angel and Maris are also working on other innovations. So far, their arrangement has been an informal de facto partnership, using a room in Angel’s house as a shared workspace. They live in the State of Virginia. But now they realize they need to get serious about their business plan. An investor is interested in funding production and beta testing of MvMe. They want to minimize their personal liability in their business operations. Maris has read an article about LLC, C-Corp, and S-Corp structures, but does not know which would be best for them. They have asked for your advice. Discuss! Consider Angel and Maris’ situation, including their stakeholders, and likely strategic planning for their business. Which of the following business structures are best for Angel and Maris and why? (Select one.)•LLC •C-Corp •S-Corp
Answer Below:
There are many options that can be utilized in this case, but an LLC is one of the most suitable. Angel and Maris should definitely set up a Limited L...
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