Acme Fireworks Prospectus Essay

cover Fire excogitates is a fireworks retail merchant that swaps fireworks, puts on ground demonstration fireworks, and large aerial displays fireworks. elevation Fireworks has been a repair proprietary since it began cardinal years ago. At this time the owner is receiving inquiries as to superlative degree Fireworks competency to create fireworks displays on a regular basis. deferred payment Rog12 l 1033 (Rogers, 2012). In anticipation of increased business, the owner of Acme Fireworks is in enquire of some knowledge. This prospectus is going to inform the owner as to Whether or non the business bequeath be governed by common law or the Uniform commercial-grade Code. Analyze whether or non the owner has any actual contracts.Explain the potential personal liability to Acme Fireworks is some single is injure by a stray firework. Discuss different date types while discussing the advantages and disadvantages of each type as it applies to Acme Fireworks. And finall(a)y, give suggestions as to why Acme Fireworks should no longer be a fillet of sole proprietorship. When it comes to contracts, it is important to understand that there ar two different bodies of law that come into play, the Uniform Commercial Code (UCC) and the common law of contracts. The difference amid the UCC and the common law contract can polish off a huge difference in the turn upcome of a contract dispute. This could be the difference between being fitted to nab punitive damages, discharge or modify a contract, be satisfactory to sue under breach of contract, and whether or not there truly a legally perceptible contract after all approval Gun12 l 1033 (Denton, 2012). It is important to understand the type of contract governed by each body of law.The UCC applies to the sale of goods and securities, and common law of contracts applies to contracts for services, real estate, insurance, intangible assets, and employment CITATION Gun12 l 1033 (Denton, 2012). If the contract s hould happen to be for boththe sale of goods and for securities, the dominant element would be in work of the contract CITATION Gun12 l 1033 (Denton, 2012). Should Acme Fireworks have contracts with the inquiring businesses, these contracts would be governed under UCC rule. The contracts would be for both goods and services with goods being the dominant factor of the contracts. thither would be much fireworks than there would be personnel. Hence, this would be the reasoning for a UCC contract. In order for the owner to have valid contracts with inquiring businesses there are five elements that essential be present in order for the contracts to be valid. First there must be an offer. An offer is an invitation for an another(prenominal) to enter into a contract CITATION Rog12 l 1033 (Rogers, 2012).Then there is the pauperization for acceptance.Acceptance is the acquiescence to enter into a contract CITATION Rog12 l 1033 (Rogers, 2012). Then there is consideration. contemplation i s anything of legal value that is asked for and turn aroundd as the price for entering into a contract CITATION Rog12 l 1033 (Rogers, 2012). Now there is righteousness. Legality is the extent to which the contract is legal and not against public policy CITATION Rog12 l 1033 (Rogers, 2012). Finally, there is capacity. Capacity is the mental competency to enter into a contract CITATION Rog12 l 1033 (Rogers, 2012). Considering Acme Fireworks new contracts Was there an offer? No, there was not an offer. The businesses were making inquiries, postulation questions trying to find out what Acme Fireworks could handle. Was the acceptance? No, there was no acceptance. There were no contracts offered, wherefore nothing to accept. Was there consideration? No, there was no consideration. Pricing of the firework displays was talked about, scarcely that was merely information given to answer question f the inquiry. Is there legality? Yes, when the contracts are do they will be legal as they will not be against public policy. Is there capacity? Yes, there is capacity.It is sound to assume that the owner of Acme Fireworks and the owners of the other businesses are of sound mind and body therefore able to enter into legally binding contracts. So, did the owner have enforceable contracts? No, he did not. While there was legality and capacity there was no offer, acceptance, or consideration present. Fireworks displays are beautiful and exciting, but they are overly very dangerous. The operator of a fireworks display has a duty to fireworks are done in a honorable way that does not injure spectators CITATION All13 l 1033( occupation, 2013). To successfully sue a means of a firework display, it must be shown that the promoter failed to keep spectators at a reasonable safe distance CITATION All13 l 1033 (Business, 2013). In order to sue the operator of a firework display it must be shown that the spectator was injured by the discharge of a fireworks or firework that did n ot explode properly CITATION All13 l 1033 (Business, 2013). Should an injury occur negligence by the operator is presumed, as the operator is in sole control of firing the fireworks. Essentially, Acme Fireworks is going to wishing any such(prenominal) liabilities to be the responsibility of the company and not result in personal liability. Being a sole proprietorship Acme Fireworks will be liable for all debts and claims against the business. A lawsuit of this type could be financially devastating.However, should Acme Fireworks take the time and effort to incorporate or to form a check Liability Company they would more than comparablely be protected to a significant degree from such personal injury CITATION All13 l 1033 (Business, 2013) Should these contracts come into being, Acme Fireworks will need to hire more employees. But which type of employee should Acme Fireworks employ? The full-time employee works regular and on-going, between 35-45 hours a week, which includes non- m esh entitlements and benefits like paid holiday leave, sick leave, and long service leave CITATION ASU14 l 1033 (ASU, 2014). Part-time aeonian work is regular and on-going, involves fewer hours than full-time and usually has set days or set hours. No benefits and entitlements are received by part-time employees. Casual work is on-going and involves irregular hours and hourly pay. Casual workers work on an as needed basis, which means that they work when they are needed CITATION ASU14 l 1033 (ASU, 2014). There are no entitlements for casual workers since the entitlements are factored into 20% of the higher hourly rate that casual workers receive CITATION ASU14 l 1033 (ASU, 2014).Casuals usually receive hourly rates of pay based on a minimum 15% loading of normal or applicable hourly rates of pay CITATION ASU14 l 1033 (ASU, 2014). Fixed term or contract employees are hired for a fixed arrest of time for a specific project or to replace an employee on sick leave or paternal leave CIT ATION ASU14 l 1033 (ASU, 2014). This type of employee would need an agreement in writing that sets out the length of the employment contract. Fixed term employees are entitled to the same annual personal and other leave asfull-time employees, but on a proportional basis for the period of their employment CITATION ASU14 l 1033 (ASU, 2014) Piecework and commission only payment employees rather than being paid a wage or salary are paid by Piecework the paying f a specific tot for completing a specific task. Commission the paying of a percentage for each sale made Retainer plus commission the paying of a fixed amount plus commission. Should Acme Fireworks adjudicate to hire more employees, my suggestion would be to hire casual workers. Casual workers do not reckon to work all the time they work when they are needed. They would not have to give them any entitlements just work.Should Acme Fireworks become so busy that they are working everyday then they might want to get some full t ime workers. But, as of right now go with the casual workers. Acme Fireworks has been a sole proprietorship since it began two years ago. As a sole proprietorship all liabilities for finances and operations are on the owner. The owners personal property is tied to the business, so the owner assumes a risk against his personal property should the business experience financial hardship. Profits and losings of the business are reported through and through the owner and are taxed at the individual rate. The sole proprietorship entity is the easiest entity to set up, but the owner will probably have to sell the business to retrieve his investment. Should Acme Fireworks become a coalition? A fusion has two or more owners that share affect control, unless the partnership agreement says otherwise or the entity is set up as a limited partnership CITATION Phi14 l 1033 (Phillips, 2014). Like a sole partnership, lolly and losses of the business flow through the partners and are taxed at the individual rate. Operating partners assume risks, both legally and financially.Creditors can attempt to collect debts from the partners personal assets CITATION Phi14 l 1033 (Phillips, 2014). To recoup their investment the partner is required to sell his interest in the business. With the potential for devastatingly high personal injury claims, this entity would not be the one for Acme Fireworks. This entity jeopardizes the personal assets of the businesses owners. A corporation? A corporation can have an unlimited number of owners, cognise as shareholders. This business entity remains separate from the owners in legal and financial matters CITATION Phi14 l 1033 (Phillips, 2014). The profits and losses of a corporation are taxed at corporate rates, not individual rates.Should thecorporation look a profit it is paid out to the shareholders who then report it as income and pay taxes on it at an individual rate CITATION Phi14 l 1033 (Phillips, 2014). Corporations are taxed twice, on ce at the time of profits and losses and then again when the shareholders realize the dividends. Or a limited liability company? This entity is a partnership and a corporation mixed together. Owners are protected from personal liability like a corporation, but enjoy the tax advantages similar to a partnership. The LLC would be the entity I would suggest for Acme Fireworks due to the ability to be free from personal liability and the ability to be taxed at the lower partnership rate.ReferencesBIBLIOGRAPHY l 1033 ASU. (2014). Employment Type Defin itions & Eligibility Summary. Retrieved from ASU http//www.asu.edu Business, A. (2013, July 13). Fireworks Displays. Retrieved from Avoiding Personal Liability http//www.allbusiness.com Denton, G. &. (2012). Thwe difference between a contract that falls undert the UCC and one that does not and why it is important to you. Retrieved from Gunderson & Denton at Law http//www.gundersondenton.com/business/difference-contract-falls-ucc-important Ph illips, C. (2014). Three Types of Business Entity. Retrieved from Small Business http//www.smallbusiness.chron.com Rogers, S. (2012). Essentials of Bussiness Law. San Diego Bridgepoint Education, Inc.