Jeb and Josh are lifelong friends. Jeb is a wealthy wind-power tycoon, and Josh is an active outdoor enthusiast. They have decided to open a sporting goods
store, Arcadia Sports, using Jebs considerable financial resources and Joshs extensive knowledge of all things outdoors. In addition to selling sporting goods, the
store will provide whitewater rafting, rock-climbing, and camping excursions. Jeb will not participate in the day-to-day operations of the store or in the
excursions. Both Jeb and Josh have agreed to split the profits down the middle. On the first whitewater rafting excursion, a customer named Jane falls off the
raft and suffers a severe concussion and permanent damage to her spine. Meanwhile, Jebs wind farms are shut down by government regulators, and he goes
bankrupt, leaving extensive personal creditors looking to collect.
Specifically, the following critical elements must be addressed:
A. Identify the main types of business entities and discuss the advantages and disadvantages of each.
B. Recommend a specific business entity for Arcadia Sports and include your reasoning.
C. Based on the characteristics of each type of business entity, determine the type under which Jeb and Josh would be personally liable to Jane for
damages.
D. Based on each type of business entity, analyze the ability of Jebs personal creditors to seize the assets and/or profits of Arcadia Sports.
