Reference no: EM132488872

Problem: David and his sister Christa made unusual kites. They both created the designs; David made the patterns. Friends had always wanted to buy their kites. After Christa completed a college marketing program, she began to talk to David about going into business selling kites. mike, a friend of Christa's wanted to be involved. He said he could buy the supplies and do other odd chores. They decided to try to make a go of it and to share the profits as follows: David 35%, Christa 35%, and mike 30%. Things went well for 7 months. They even hired George to deliver kites to the increased number of stores buying them. Christa and mike became romantically involved. This was followed by a heated dispute. mike disappeared with $1,300 collected from customers and $600 worth of supplies, which he had bought using the business credit account on behalf of the business from their regular supplier. At about the same time, George negligently broke a customer's $200 lamp when he was delivering a kite.

a. What kind of business organization is this? Prove it.

b. For which of the following can David be held fully liable? Explain.

i. The broken lamp

ii. The $600 for the supplies

iii. Business debts