Business Structures and Separation of Powers in Australia

Project 1 Individual

TABLE OF CONTENTS
QUESTION 1...................................................................................................................................3
QUESTION 2...................................................................................................................................4
REFERENCES................................................................................................................................5

QUESTION 1
A) As per the current situation, jay is engaged in a business with two other people, they have
earned annual turnover for the two financial years is 4m. in order to expand their business
jay needs more capital but don’t want to take loan from bank as he believe bank may not
lend them the amount business will need. Due to lending related rules and regulation the
partners are concern about interest rates as they are finding that business is paying too
much tax now. By evaluating the scenario, it has been recommended that partnership is
the most suitable business structure Wantasen, Umboh and Leke (2021). With the help of
partnership structure, jay and his partners is able to enhance their lease of knowledge.
Plus, they can have expertise while working with together which helps them to make
better decisions and reach their goals of expanding business. By having this structure, jay
and his partners will be having more capital available for the business through loans. The
major benefit of partnership structure is that partners will have high level of borrowing
capacity as nowadays start-up costs are low and support of government has created more
confidence among business owners (Business structure, 2022). However, the partners
need to know about drawback that is liabilities issues before spending they need to set
budgets in order to avoid uncertainty in the future.
B) According to this scenario, it has been identified that jenny has recently retired from her
current job as a lawyer for 30years. As she knows how to make cupcakes and to keep
herself active and busy at the same time, she decided to sell them at the farmer’s market
which is situated near her locality. Jenny has learned a unique recipe for cakes with the
help of grandmother and she believe that she is going to earn some money and will hit the
market every Saturday. It is recommended to follow sole proprietorship business
structure which is the most suitable as per current scenario Eniola, Iyabo and Peter, (2018).
As jenny is looking forward to a relatively quiet lifestyle aims to reduce legal formalities,
complexities and less paperwork, this business structure is the best suited for her. The
reason behind that is the major benefit of using this structure is a person won’t have to fill
out a lots of paperwork (Business structure, 2022). The person does not need any kind of
registration with the state government, she can become a business entity merely by
starting business and run it. But she needs to understand that in order to run business she
might obtain license as it depends on the needs and rules of local government. However,