Lorna Has Recently Developed a Software Program Tailored for the Upscale

question 44

Essay

Lorna has recently developed a software program tailored for the upscale coffee shop industry.Lorna has begun marketing her program and has had some success selling to small independent stores.She is now ready to begin marketing to franchisees of the national chains,with the hope that a franchisor might make the software part of its required franchisee package.Lorna wants to keep the business separate from her personal affairs,so she has set up separate checking accounts,separate phone lines,and has set up a fictitious business name that does not use her name.She has filed a fictitious business name statement in the appropriate state office.She has written a will in which she has declared that in the event of her death,her business and personal assets and liabilities are to be kept separate,just as they were during her life.Her personal checks say,"Lorna Lones,personal account only." Discuss the extent to which Lorna has insulated her personal assets from any business losses.

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Definitions:

Insurance Company

A business entity that provides financial protection or compensation to individuals or entities against losses or damages, in exchange for premium payments.

Insured

The individual or entity covered under an insurance policy, protected against specified risks and potentially eligible for claims settlement.

Medicare

A federally funded health insurance program for people 65 years and over who are eligible for Social Security.

Federally Funded

Financially supported or subsidized by a national government.