Maurice and Stanley have been operating a train store together for two years. After a patron slipped on some water on the floor and was injured, they began to think about their personal liability and decided to change the business form to one that would give them the same ability to pass-through profits and shared ownership and control but with little government interference. They would most likely form a
A)limited-liability company.
B)corporation.
C)limited partnership
D)syndicate.

Question

​Maurice and Stanley have been operating a train store together for two years. After a patron slipped on some water on the floor and was injured, they began to think about their personal liability and decided to change the business form to one that would give them the same ability to pass-through profits and shared ownership and control but with little government interference. They would most likely form a
A)​limited-liability company.
B)​corporation.
C)​limited partnership
D)​syndicate.

Quizplus · Accepted Answer

A limited-liability company (LLC) would provide Maurice and Stanley with the pass-through profits and shared ownership and control they desire, while also limiting their personal liability in case of accidents or lawsuits. An LLC is also subject to less government regulation and paperwork than a corporation. A limited partnership and syndicate both involve shared ownership and control, but do not provide the same level of liability protection as an LLC. A corporation would also provide liability protection, but involves more government regulation and formalities than an LLC.

​Maurice and Stanley Have Been Operating a Train Store Together

Maurice and Stanley Have Been Operating a Train Store Together