Jurisprudence IUSD Update(rated A)

Jurisprudence IUSD Update(raWhich practice association is the easiest and least expensive to form and why? -ANSWER *The Sole Proprietorship* is the simplest form of business organization and, therefore, the least expensive to maintain. There are normally no formalities required to begin What is a Certificate of Assumed Business Name and how does it pertain to a dental practice? -ANSWER A *Certificate of assumed business Name* is a state form used to identify your business. Does a sole proprietorship limit the owner's personal liability? Why or why not? -ANSWER No All business property and all personal property are subject to the claims of creditors. In other words, this type of business organization provides no protection to the owner's personal assets. Why is a sole proprietorship at a disadvantage compared to other associations when raising working capital? -ANSWER The SP's ability to raise working capital is limited to the amount of money that can be obtained through her own asset base and borrowing power. How is a sole proprietorship taxed? -ANSWER As a sole proprietor you must report all business income or losses on your personal income tax return; the business itself is not taxed separately. (The IRS calls this "pass-through" taxation, because business profits *pass through* the business to be taxed on your personal tax return. Define a partnership -ANSWER Partnership: An association of two or more persons to carry on, as co-owners, a business for profit. *Note the intent is to make a profit*. What is "joint and several" liability? -ANSWER An unlimited liability (including personal assets) of each partner for all debts of the business whether in contract or tort. (from wiki) *Joint and several liability* is when multiple parties can be held liable for the same event or act and be responsible for all restitution required. ... The liable parties would be required to pay the entire damage award, which could be split among multiple parties or could come from just one party. How is a partnership taxed? What does "pass through" taxation mean? -ANSWER Each partner is required to file a personal tax return, but the partnership itself is also required to file an informational return. This return will indicate how income and loss was allocated among the partners. All income and losses flow through to the partners and their returns. Remember, the partnership agreement can state how income and loss is to be allocated among the partners Describe "partnership by estoppel" and why it should be avoided -ANSWER *Partnership by estoppel* = Legally binding partnership that may arise where, in fact, *no formal partnership agreement is in effect* A person who by conduct or words represents, or allows him/herself to be represented, as a partner in a firm is liable for the credit or loans obtained by firm on the basis of such representation. Are partners required to share profits and losses equally? If not, how is it accomplished? -ANSWER No, there should be a clause for that in the partnership contract Each partner in a partnership has _________ authority in regards to making business decisions with third party suppliers -ANSWER Implied Thus all partners are liable for the other partner's business decisions (e.g. I buy a new sign for my practice and cannot pay my debt, thus my partner takes on ted A)