Answer Happy

Jay, a businessman, invited two friends to join him in a business venture. He is willing to invest his business and asked his two friends what their contributions will be. Michael, a balikbayan, would like to invest cash, but doubts he could actively participate in its management since he is in the Philippines only for a vacation. Nevertheless, he is eager to join the partnership with the condition that since he cannot actively participate he should be liable only to the extent of what he invested. Angelo must join the business since his expertise is needed for the type of venture Jay is contemplating to put up but does not want to make any capital contribution. A. Is it possible for the three friends to put up the business? Identify the roles they will play. B. Jay gives you four alternative methods of dividing profits. Which do you think would be best for the partners? Why? a. Based on their contributions ratio b. Salaries to Angelo and Jay with the remainder, if any, based on their contributions ratio Salaries to Angelo and Jay, bonus to Angelo with the remainder, if any, based on their contributions ratio d. Salaries to Angelo, remainder based on their contributions ratio C.