Chapter 12, Problem 5QPD

Mr. Eros operates an antique store located on the first floor of a four-story office building owned by Mr. Eros. The top three stories are leased to business tenants. Mr. Eros is considering giving a one-third interest in both the antique store and the building to each of his two grandchildren and operating the businesses in one passthrough entity. Mr. Eros wants to receive 100 percent of the rent from his tenants for several years but is willing to distribute one-third of the net profit from the antique store to his grandchildren each year. On the basis of this objective, which form of organization should he choose?