Question

Scenario:After a year of selling hats and handbags through an online store, Janet and Jose need to expand their business. Although their partnership has been successful, they believe it is time to bring other owners and shareholders into the picture. They decide to start a corporation. Use the drop-down menus to complete the statements. To begin their corporation, they must first . Now that their business has become a separate legal entity, Janet and Jose are for the company's debts. As a corporation, they can raise capital by to new shareholders.

Answer 1

1)To begin their corporation, they must first  ✔ register with the state

2) Now that their business has become a separate legal entity, Janet and Jose are ✔ no longer responsible 

3) As a corporation, they can raise capital by sell products advertising ✔ selling stock to new shareholders.

Answer 2

1)To begin their corporation, they must first  REGISTER WITH THE STATE.

To begin a corporation, it must be registered. Registration of a business is very important for various reasons which include; protection from personal liability; it establishes the business as a legal entity; the corporation can be protected in any case of a grievance procedure; easy access to loans and investors.

2) Now that their business has become a separate legal entity, Janet and Jose are no LONGER RESPONSIBLE FOR THE COMPANY'S DEBT.

3) As a corporation, they can raise capital by SELLING STOCK TO NEW SHAREHOLDERS.

Raising of capital becomes easier as the business is a legal entity and investors will be able to trust such business.