Recently, you were contacted by a friend who was thinking of signing a Joint Venture agreement to fund a new shopping center to be built in Melbourne. Along with several other investors, each party will invest $25,000 to the venture in order to pay for the building and construction work. Your friend knows several of the other investors and is looking forward to working closely with the other investors on this new project, however your friend feels very strongly about keeping his business affairs completely separate from those of other investors. Required: What advice and/ or warning would you give your friend before signing the Joint Venture contract? You must refer to legislation and/ or case law and clearly define all business structures that may impact on the advice you give your friend.
Recently, you were contacted by a friend who was thinking of signing a Joint Venture agreement to fund a new shopping center to be built in Melbourne. Along with several other investors, each party will invest $25,000 to the venture in order to pay for the building and construction work. Your friend knows several of the other investors and is looking forward to working closely with the other investors on this new project, however your friend feels very strongly about keeping his business affairs completely separate from those of other investors. Required: What advice and/ or warning would you give your friend before signing the Joint Venture contract? You must refer to legislation and/ or case law and clearly define all business structures that may impact on the advice you give your friend.
Chapter19: Deferred Compensation
Section: Chapter Questions
Problem 1RP
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Question
![Recently, you were contacted by a friend who was
thinking of signing a Joint Venture agreement to
fund a new shopping center to be built in
Melbourne. Along with several other investors,
each party will invest $25,000 to the venture in
order to pay for the building and construction work.
Your friend knows several of the other investors and
is looking forward to working closely with the other
investors on this new project, however your friend
feels very strongly about keeping his business
affairs completely separate from those of other
investors.
Required: What advice and/ or warning would you
give your friend before signing the Joint Venture
contract? You must refer to legislation and/ or case
law and clearly define all business structures that
may impact on the advice you give your friend.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe9b5232c-215e-4fc4-96f8-116e76241cb6%2F867a7353-fce9-425f-b4cb-64bf515d1d97%2F5vsra5_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Recently, you were contacted by a friend who was
thinking of signing a Joint Venture agreement to
fund a new shopping center to be built in
Melbourne. Along with several other investors,
each party will invest $25,000 to the venture in
order to pay for the building and construction work.
Your friend knows several of the other investors and
is looking forward to working closely with the other
investors on this new project, however your friend
feels very strongly about keeping his business
affairs completely separate from those of other
investors.
Required: What advice and/ or warning would you
give your friend before signing the Joint Venture
contract? You must refer to legislation and/ or case
law and clearly define all business structures that
may impact on the advice you give your friend.
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