In early 2013, Doc and Lyn McGee formed the MGee Ceice the assets it owns, but demand for its cakes is still growing. Further, the company has been approached by a national super- narket chain with a proposal to put four of its cakes in all of Company. The company produced a full line of cakes, and its specialties included chess cake, lemon pound cake, and double-iced, double-chocolate cake. The couple formed the company as an outside interest, and both continued to work at their current jobs. Doc did all the baking, and Lyn handled the marketing and distribution. With good product quality and a sound marketing plan, the company grew rapidly. In early 2016, the company was featured in a widely distributed entre- the chain's stores, and a national restaurant chain has contacted the company about selling McGee cakes in its restaurants. The restaurant would sell the cakes without a brand name. Doc and Lyn have operated the company as a sole propri- etorship. They have approached you to help manage and direct the company's growth. Specifically, they have asked you to an- swer the following questions. preneurial magazine. Later that year, the company was featured in Gourmet Desserts, a leading specialty food magazine. After the article appeared in Gourmet Desserts, sales exploded, and the company began receiving orders from all over the world. Because of the increased sales, Doc left his other job, fol- lowed shortly by Lyn. The company hired additional workers to meet demand. Unfortunately, the fast growth experienced by the company led to cash flow and capacity problems. The com- pany is currently producing as many cakes as possible with QUESTIONS 1. What are the advantages and disadvantages of changing the company organization from a sole proprietorship to an LLC? 2. What are the advantages and disadvantages of changing the company organization from a sole proprietorship to a corporation? *Chess cake is quite delicious and distinct from cheesecake. The origin of the name is obscure. 3. Ultimately, what action would you recommend the com- pany undertake? Why?

In early 2013, Doc and Lyn McGee formed the MGee Ceice the assets it owns, but demand for its cakes is still growing. Further, the company has been approached by a national super- narket chain with a proposal to put four of its cakes in all of Company. The company produced a full line of cakes, and its specialties included chess cake, lemon pound cake, and double-iced, double-chocolate cake. The couple formed the company as an outside interest, and both continued to work at their current jobs. Doc did all the baking, and Lyn handled the marketing and distribution. With good product quality and a sound marketing plan, the company grew rapidly. In early 2016, the company was featured in a widely distributed entre- the chain's stores, and a national restaurant chain has contacted the company about selling McGee cakes in its restaurants. The restaurant would sell the cakes without a brand name. Doc and Lyn have operated the company as a sole propri- etorship. They have approached you to help manage and direct the company's growth. Specifically, they have asked you to an- swer the following questions. preneurial magazine. Later that year, the company was featured in Gourmet Desserts, a leading specialty food magazine. After the article appeared in Gourmet Desserts, sales exploded, and the company began receiving orders from all over the world. Because of the increased sales, Doc left his other job, fol- lowed shortly by Lyn. The company hired additional workers to meet demand. Unfortunately, the fast growth experienced by the company led to cash flow and capacity problems. The com- pany is currently producing as many cakes as possible with QUESTIONS 1. What are the advantages and disadvantages of changing the company organization from a sole proprietorship to an LLC? 2. What are the advantages and disadvantages of changing the company organization from a sole proprietorship to a corporation? *Chess cake is quite delicious and distinct from cheesecake. The origin of the name is obscure. 3. Ultimately, what action would you recommend the com- pany undertake? Why?

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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Transcribed Image Text:MINICASE The McGee Cake Company In early 2013, Doc and Lyn McGee formed the MaBee Ceke Company. The company produced a full line of cakes, and its specialties included chess cake, lemon pound cake, and double-iced, double-chocolate cake. The couple formed the company as an outside interest, and both continued to work at their current jobs. Doc did all the baking, and Lyn handled the marketing and distribution. With good product quality and a sound marketing plan, the company grew rapidly. In early 2016, the company was featured in a widely distributed entre- the assets it owns, but demand for its cakes is still growing. Further, the company has been approached by a national super- market chain with a proposal to put four of its cakes in all of the chain's stores, and a national restaurant chain has contacted the company about selling McGee cakes in its restaurants. The restaurant would sell the cakes without a brand name. Doc and Lyn have operated the company as a sole propri- etorship. They have approached you to help manage and direct the company's growth. Specifically, they have asked you to an- swer the following questions. preneurial magazine. Later that year, the company was featured in Gourmet Desserts, a leading specialty food magazine. After the article appeared in Gourmet Desserts, sales exploded, and the company began receiving orders from all over the world. Because of the increased sales, Doc left his other job, fol- lowed shortly by Lyn. The company hired additional workers to meet demand. Unfortunately, the fast growth experienced by the company led to cash flow and capacity problems. The com- pany is currently producing as many cakes as possible with QUESTIONS 1. What are the advantages and disadvantages of changing the company organization from a sole proprietorship to an LLC? 2. What are the advantages and disadvantages of changing the company organization from a sole proprietorship to a corporation? 3. Ultimately, what action would you recommend the com- pany undertake? Why? *Chess cake is quite delicious and distinct from cheesecake. The origin of the name is obscure.

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