Acme Fireworks

Acme Fireworks

Brenda Plas

Business Law 1 BUS311

Peter McCann

October 31, 2015

Acme Fireworks

When an organization decides to change the type of business it needs to evaluate each entity that would be best suited to their business needs. Right now Acme Fireworks operates as a sole proprietorship that is growing fast and has new opportunities for further expansion. There are three types of businesses Acme can choose from: a partnership, corporation, and limited liability company or LLC. Acme needs to analyze the pros and cons of each type of business before taking into consideration of which one to choose. I would recommend Acme Fireworks to become a corporation when taking into account of their current personal liability.

Practically everyone in the U.S. has had some experience with fireworks, especially from Fourth of July along with other celebrations. However fireworks are dangerous and have caused serious injuries and accidents each year. According to the 2014 annual fireworks report there were an estimated 10,500 injuries and 11 non-occupational deaths (Tu, 2014). Personal liability suits are brought against many firework companies each year due to these injuries and deaths. Many things can go wrong with fireworks like sending out embers from their explosions. These hot embers can set houses or nature on fires. Fireworks can also be improperly used, with or without the intent to cause harm or damage. Kids without supervision can get a hold of fireworks and cause accidents. Even with perfectly designed fireworks and proper usage, accidents still occur. One of the biggest issues companies face is product liability. In an age where everyone is suing everyone the area between product liability and consumer liability is becoming increasingly gray.

The owner of Acme fireworks, a sole proprietor, is the only person responsible for the business debits and liabilities. They assume all the risks as well as the profits. There is no legal distinction...