A conglomerate merger is a merger between firms that are involved in totally unrelated business activities. There are two types of conglomerate mergers: pure and mixed. Pure conglomerate mergers involve firms with nothing in common, while mixed conglomerate mergers involve firms that are looking for product extensions or market extensions.…
Salta Company installs a manufacturing machine in its factory at the beginning of the year at a cost of $87,000. The machine’s useful life is estimated to be 5 years, or 400,000 units of product, with a $7,000 salvage value. During its second year, the machine produces 84,500 units of product. Determine the machines’ second year depreciation under the units of production method:…
The main disadvantages of an organization are their double taxation of profits/dividends and the separation between ownership and control of the firm.…
Disadvantages are Because of the basic type of business, it is hard to keep your personal and business accounts separate.…
Joint venture physician practices over-treat patients and reap economic rewards in the process. These types of practices are very different from the traditional group practices described in the text. Physicians partnered in traditional large group practices provide comparable services, usually practicing within the same specialty, such as Dermatology or Orthopedics. As Getzen (2010) explains, "One reason for physicians to work together in group practices is to obtain economies of scale from sharing office space, equipment, and information systems." (Getzen, 2010).The goal of these physicians groups are to increase revenue through sharing the expenses associated with ancillary help. The traditional group practice structure appears to uphold…
Some disadvantages to general partnerships, principally liability. General partners are personally liable for the business debts and liabilities. Each partner is also liable…
One disadvantage of a general partnership is each partners' responsibility for the acts of all other partners.…
However, when considering the security of a partnership, the disadvantages raise concerns about how safe an option a partnership is;…
5. One drawback of switching from a partnership to the corporate form of organization is the following:…
In a liquidating distribution, a partnership need not distribute all of its property to all of its partners.…
The con of the JIT relationship is that problems would occur if the company has sudden breaks to service and the supply. This may lead to labor strikes, and then eventually a failed business.…
Imagine that you are meeting with your superiors to discuss entering a foreign market. Your boss has asked you to analyse a joint venture prospect. Why might you tell your boss that the joint venture is not a good idea?…
Dilger Corporation (referred to hereinafter as "Dilger") and Rall Consulting (referred to hereinafter as "Rall") are pleased to submit their intent to form a joint venture (referred to hereinafter as "Initial Venture"). The Initial Venture between Dilger and Rall (referred to hereinafter as the "Parties") shall be referred to herein as the Transaction and the date of the consummation of the Transaction shall be referred to as the Closing.…
esearch indicates that almost 70% of all joint ventures fail. Joint ventures (or JVs)—whereby two or more parties combine their resources in a joint business undertaking—can be a great way for start-up and established companies alike to obtain needed money or expertise, introduce new products or services to an existing market or bring existing products and services to a new market. So why do these relationships have such an alarmingly high failure rate? And what can you do to increase the likelihood that your next JV will be a success? Most JVs are doomed to failure from their inception for one or more of the following reasons: 1. Bad Ideas. In the classic JV situation, companies form a joint venture because neither of them, alone, has adequate resources (generally money, personnel, technology or expertise) to undertake the venture on its own. Increasingly, however, JVs are motivated less by resource sharing than by risk sharing. Companies use JVs to pursue products, services and markets that they have chosen not to pursue on their own because the projects are deemed too risky. Unfortunately, “risky” is often code for not worthwhile or uncommercial. If a project is not worth undertaking alone (assuming the company has the resources to do so), it may not be worth undertaking. 2. Insufficient Planning. One of the most prevalent reasons for failed joint ventures is a lack of sufficient planning. Joint venture “plans” consisting of nothing more than a statement of each party’s intended contributions to the JV and their respective share of the profits seldom work. The parties have nothing to shape their expectations or to govern their disputes. Parties of the joint venture should agree to a comprehensive written plan upfront including provisions for each of the following:…
The headings of the clauses in this agreement are for the purpose of convenience and reference only and shall not be used in the interpretation of this agreement.…