Legal and Business Analysis of Acme Fireworks: Contract Formation, Liability, Employment Law, and Business Entity Recommendations

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Legal and Business Analysis of Acme Fireworks: Contract Formation, Liability,Employment Law, and Business Entity RecommendationsYou are the manager of Acme Fireworks, a fireworks retailer who sells fireworks, puts on ground displayfireworks, and large aerial display fireworks. The company started in the owner’s garage two years agoand now has 15 employees that you manage. The company started as a sole proprietorship, and theowner has never changed the entity. The owner has informed you that the company has receivedinquiries from several large businesses wondering if the company could create several fireworks displayson a regular basis. The owner told the inquirers that the company could fill such display orders, and aprice per display was agreed upon. It was discussed that most of the cost for a fireworks display is forskilled labor, insurance, and the actual service of setting off the fireworks. No other details werediscussed. The owner is anticipating that new employees will need to be hired, but he is worried that if thelarge orders for fireworks displays do not continue, the company will not have the funds to pay the newemployees. The owner is now considering changing the business entity, but he does not know what entityto form or how to form it.The owner has asked you to do the following:Determine if the contracts with the businesses will be governed by common law or the Uniform CommercialCode (UCC), and explain why.Analyze whether the owner formed a contract with the businesses, and apply the five essential elements of anenforceable contract.Explain the potential personal liability to Acme Fireworks if a spectator is injured by a stray firework from afireworks display.Discuss the different employment types and relationships relevant to agency law, and analyze the advantagesand disadvantages of each type specific to Acme Fireworks.Explain why Acme Fireworks should not operate as a sole proprietorship. Recommend a new business entity,and provide rationale to support your recommendation.For each task, be sure to analyze the relevant law, apply the facts to the law, and make a conclusion.Facts:Acme Fireworks, a fireworks retailer who sells fireworks, puts on ground display fireworks, andlarge aerial display fireworks. The company started in the owner’s garage two years ago and nowhas 15 employees that you manage. The company started as a sole proprietorship, and the ownerhas never changed the entity. The owner has informed you that the company has receivedinquiries from several large businesses wondering if the company could create several fireworksdisplays on a regular basis. The owner toldthe inquirers that the company could fill such display

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