Overview
Please read the Assignment 1 Information on Canvas which will give the due date and time for submission and other important details about this assessment task.
Please also refer to the Marking Rubric for this Assignment on Canvas.
Anki and Lin have embarked on the exciting project of starting a café together. They have prepared a business case which sets out start-up costs and projected cash flows which they think are realistic. For initial capital Lin will contribute $25,000 of her own money and Anki is borrowing $25,000 from a close relative to make her contribution. However they will need another $50,000 in cash and are hoping to borrow this on commercial terms through a finance broker.
The café will open from 7am to 3pm seven days per week. Lin will be working in the café for six days each week. Anki will work in the café on the weekends only as she has another full-time job, but will also handle the administrative and accounting duties. They plan on employing some of their friends on a casual basis as needed.
Their first big problem is finding suitable premises: they will need to enter into a commercial lease and it is proving hard to find a good location at an affordable rent.
Advise Anki and Lin as to whether a partnership or a company is a more suitable business structure for their project and what steps need to be taken to set up each of these two alternative business structures.