Katy Stack Case Summary
1. Katy Stack is a highly successful impresario of alternative rock concerts. She started in Midwestern college towns, but is now promoting concerts nationwide. Her business is still a sole proprietorship. Why would she choose to remain a proprietorship? What concerns does she face being one?
There are a few reasons she would choose to remain a proprietorship, since it is a sole proprietorship she alone has claim of the company and all of the profit (Gottheil, 2013). She is also free to make the decsions she wants. One the other side she is completel responsible and if something fails it is on her and it can be stressfull making life altering decisions (Gottheil, 2013).
2. Why would Katy even think of converting her business to a partnership? What are the downsides she would have …show more content…
A few things she would have to consider is that there would be other people making and helping make the descions and the libility of the entire business could still fall on her (Gottheil, 2013).
3. Suppose she decides to switch from Stack Promotions to Stack Promotions, Inc. Why would she do that?
She would change to a coroporation to protect herself from all of the libility (Gottheil, 2013).
4. There are 1,000 shareholders of Stack Promotions, Inc. Suppose you are one of them. Explain why you would prefer to buy shares of the business and not the corporation’s bonds.
I would prefer to buy shares because they have a higher return whereas bonds usually pay a stipulated return.
5. In June 2010, the company began to promote concerts in Europe. By January 2011, 60 percent of its business was overseas concerts. Does that make Stack Promotions, Inc. a multinational? Explain.
Yes, because “a corporation whose production facilities are located in two or more countries” (Gottheil, 2013).
6. Coca-Cola is a multinational. How does the multinational differ from any other form of corporate
There are a few reasons she would choose to remain a proprietorship, since it is a sole proprietorship she alone has claim of the company and all of the profit (Gottheil, 2013). She is also free to make the decsions she wants. One the other side she is completel responsible and if something fails it is on her and it can be stressfull making life altering decisions (Gottheil, 2013).
2. Why would Katy even think of converting her business to a partnership? What are the downsides she would have …show more content…
A few things she would have to consider is that there would be other people making and helping make the descions and the libility of the entire business could still fall on her (Gottheil, 2013).
3. Suppose she decides to switch from Stack Promotions to Stack Promotions, Inc. Why would she do that?
She would change to a coroporation to protect herself from all of the libility (Gottheil, 2013).
4. There are 1,000 shareholders of Stack Promotions, Inc. Suppose you are one of them. Explain why you would prefer to buy shares of the business and not the corporation’s bonds.
I would prefer to buy shares because they have a higher return whereas bonds usually pay a stipulated return.
5. In June 2010, the company began to promote concerts in Europe. By January 2011, 60 percent of its business was overseas concerts. Does that make Stack Promotions, Inc. a multinational? Explain.
Yes, because “a corporation whose production facilities are located in two or more countries” (Gottheil, 2013).
6. Coca-Cola is a multinational. How does the multinational differ from any other form of corporate