/BUSINESS AND CONTRACTS (1)
Situation 2 (3.2):
1. Answer tut 2
To determine a fair price for your experience, you
should consider the potential profits that your
friend could make by using your recipe and SOP
manual, as well as the value of the Porkies brand.
One way to do this is to estimate the future
earnings that your friend's five new stores could
generate using your recipe and SOP manual. If each
store has similar sales and profit margins as your
current units, then your friend's five new stores
could generate a total net profit of $300,000 per
year ($600,000 in sales per store x 10% net profit
margin x 5 stores).
You could then offer to sell your recipe, SOP
manual, and the use of the Porkies name for a
percentage of this net profit, such as 10%. This
would result in an annual royalty payment of
$30,000 to you ($300,000 x 10%).
2. If your friend is successful, causing the
name of Porkies to be even better known,
Situation 3 (3.3):
1. Will the organizational structure selected by
the partners have an impact on your decision
to extend the loan?
Liên quan đến việc trả nợ - cá nhâ n hay doanh
nghiệp trả
liên quan đến tà i sả n thu nhậ p cá nhâ n - đượ c cho
vay
The structure of the organization can affect the
ability of the partners to manage the business and
the risk associated with the loan. For example, a
well-structured partnership or corporation may
provide more accountability and reduce the risk
associated with the loan compared to a sole
 Answer2
Yes. The organizational structure will impact my
decision because it affects the liability, tax liability,
tax rate, and ownership transfer right, which are
important metrics of business risks
2. Will the operating structure selected by the
partners have an impact on your decision to
extend the loan?
The operating structure can affect the ability of the
partners to generate revenue and profit, as well as
the risk associated with the loan. For example, a
business with an experienced and successful
revenue and profits, reducing the risk associated
with the loan
thus resulting in greater demand for
franchises, should your friend share in
future revenue from franchise sales?
- tiền nhượ ng quyền trả hà ng nă m: trả 1 cụ c
và sau đó trả hà ng nă m : franchising fee
- In addition to the one-time transfer cost, the
franchisee pays the cost of the time spent
using the brand. It is a percentage of
revenue/profit calculated on a
monthly/quarterly/yearly basis depending
on the contract between the two parties.
-
- Nếu mình là chủ franchiser -> sole
ownership vì mua lạ i chỉ là franchisee -> trả
franchisee fee
-
- Nhưng nếu contract form là partnership ->
đồ ng sở hữ u -> share revenue
3. What are the ethical issues at play here?
Individual assets (xem cá nhâ n có đủ khả nă ng trả
nợ khô ng), cô ng ty hợ p danh có 2 chủ chia đều lợ i
ích -> có thể mở independent resmanagement team
may be more likely to generate
 A2
The operating structure will have an impact on the
decision to extend the loan. The operating structure
of a business will affect its financial stability,
liability and tax obligations. These factors can
influence the risk associated with lending money to
the business and may be taken into consideration
when evaluating a loan application
3. What other factors would influence your
decision?
Partners' credit history, financial statements,
business plan, market demand, competition, and
location. Partners' ability to repay the loan, the
collateral offered, and the business's cash flow and
profitability projections
The partner’s experience on the business
· Personal credit history
· Business revenue
· Business plan
· Location
4. Would it make a difference to you if the
partners were requesting the loan to complete
a franchise agreement with an established and
successful franchisor?
Yes. Because the structure of organization and plan
to use the loan affects how bank will accept the
commercial loan or not
· It is more risky to approve a loan from a new
franchisor. It is unpredictable whether they are
able to offset the loan or not with their business
plan
5. What additional information might you request
if the partners were seeking the loan to operate
as an independent restaurant? Would it matter
BUSINESS AND CONTRACTS (2)
Situation 1 (4.1)
1. Which party's position seems valid to you?
Why?
The Vincent's Tree Service seems to have a
more valid position in the argument as the
charges for the services offered should have
included removing the branches and leaves,
which in this case was not discussed. Removing
branches and leaves accounts for another form
of service that should be paid for
Situation 2 (4.2)
1. Do you believe the hotel is justified in
charging Mr. Moss for the no-shows?
Yes, it is justified that hotel can charge Mr. Moss
for the no-shows:
· The reservation data collected on the hotel's
website lists Mr. Moss's actual address, home
telephone number, and credit card number,
which suggests that he did indeed make the
reservation. Additionally, the hotel policy of
holding the rooms until 4:00 A.M. and charging
for no-shows is a common practice in the
hospitality industry.
If the reservation was made by someone else
without his consent, Mr. Moss should cancel his
card and notify the credit card company of the
transaction.
• A2
If the reservation was made by someone else
without his consent, Mr. Moss should cancel his
card and notify the credit card company of the
transaction. However, the person who made the
if the loan were for an existing restaurant as
opposed to a new start-up?
If the partners were seeking the loan to operate as
an independent restaurant, I would like to request a
more detail business plan and restaurant marketing
research report
· Yes, it would. If the loan were for an existing
restaurant as opposed to a new start-up, there
would be concrete revenue, percentage of profit
and loss
2. How would you suggest the issue be
resolved between these two contracting
parties?
The solution is that both parties discuss and agree
on the payment to be included for removing
branches and leaves. The reason is for the business
to maintain good relationship with the contractors
while reducing on conflicts.
reservation, not the hotel, would be liable for
the transaction
2. How could this hotel prevent such
misunderstandings in the future?
When the hotel receives a new reservation on web
sites, it is advised that the hotel should contact the
guest via the phone number listed in the
reservation data and confirm the reservation status
in writing. They could also require customers to
enter a unique code or password to confirm their
reservation, or they could send a confirmation
email or text message to the customer's registered
email or phone number
 A2
In order to prevent such misunderstandings in the
future, the hotel should make a phone call or send a
confirmation email to their guests to verify and
confirm that their guests actually make their
reservation.
Rev/confirm code/number - writing.
Situation 3 (4.3)
Situation 4 (4.4)
1. According to the UCC, a seller has a
responsibility not to sell defective products.
Who, in this example, is the seller?
According to UCC (Article 2 sale contract) with
term F.O.B, (a) when the term is F.O.B. the place
of shipment, the seller must at that place ship
the goods in the manner provided in this Article
(Section 2-504) and bear the expense and risk
of putting them into the possession of the
carrier; or (b) when the term is F.O.B. the place
of destination, the seller must at his own
expense and risk transport the goods to that
place and there tender delivery of them in the
manner provided in this Article (Section 2-503)
--> Both of vendor and Smoking Bones BBQ are
seller, and they have responsibility not to sell
defective products
2. Assume that you were the guest sickened by
the bacteria. Who do you believe should be
held responsible for the damages you
incurred?
Situation 5 (4.5)
1. How many room reservation contracts are you
willing to accept?
We have 300 rooms in total, and 100 rooms are
non-reserved. So we have 200 rooms available.
The average no-show rate is (8+9+12)/3=9.67%
off the reserved rooms that will not show up.
Therefore, we can accept 200*(1-9.67%)=181.26,
which means we can accept 182 reservations.
 A2
= We have 300 rooms in total, and 100 of them are
non
100 available
No-show: 8-12-9;
100 + 8%*100 = 108
=> Confirmed reservation is a contract to provide a
reservation in which the provider guarantees the
guest’s reservation will be honored until a mutually
agreeable time.
No, we just make sure that 100 rooms are available.
Therefore, we can confirm reservations in a total of
100 rooms, not exceeding.
 A3
I think both vendor and the restaurant, delivery
are responsible. Because, the vendor is
responsible for ensuring the quality of the
product before it is delivered to restaurant, but
it was contaminated before and the restaurant
did not check the quality of the product before
it was delivered to the customer.
- Supplies
- Delivery
3. What specific steps could Ms. Brennan take
to help prevent incidents such as the one
described here from reoccurring in her
restaurant?
Review the vendors’ sanitation practices and only
do business with the vendors on an approved list.
Check product quality before buying each batch of
products Ensure food processing according to food
safety standards. Restaurants need to have a careful
food preservation process during storage and
before putting food into processing
Number of reserved rooms = Total number of
rooms - Number of non-reserved rooms = 300 - 100
= 200
Therefore, the hotel can accept 9.67% of the total
number of rooms, which is:
Maximum number of room reservation contracts
= 300 x 9.67% = 29.01
=> The hotel can accept up to 29 additional room
reservation contracts.
2. Should you require that all reservations be
confirmed?
Yes, we should require all reservations to be
confirmed.
3. What factors will you consider as you make
your decision? What strategies will you employ
to reduce no-shows?
The factors that we will consider as we make our
decision:
- No of rooms available
- No show rate
- Understated/Overstated rate
Strategies we will employ to reduce no-shows:
- Charge at least 50% total payment when booking
Write a short essay (half-page) answering You can even offer a discount to patients who
questions 4 and 5, drawing from your personal prepay for their next visit.
perspective.
· Keep Your Wait Room Time to a Minimum: With
a. The factor that affects my decision is the no-
as busy as people are these days, asking customers
show rate of the hotel. It shows that among 200
to wait 20 to 40 minutes or more for an
rooms, there are 11 rooms that are unoccupied,
appointment will you have a confirmed
which is a high rate and a great loss.
reservation denies you a room because it has none
b. Using Guaranteed reservation- A contract to
available. What do you think the hotel should do
provide a confirmed reservation in which the
for you?
provider guarantees the guest’s reservation will be
4. You and your family are traveling out of
honored regardless of the time of arrival but states
state to attend one of your school team’s
that the guest will be charged if he or she no-shows
away football games. Upon arrival, the hotel
the reservation. Prepayment or payment
where you have a confirmed reservation
authorization is required.
denies you a room because it has none
+ Use Automated Reminders: Providing a quick
available. What do you think the hotel
and courteous reminder to patients about their
should do for you?
upcoming appointment not only serves to jog their
I think the hotel first should notice the
memory but is also a thoughtful step that improves
cancellation of our room before our arrival. This
patient loyalty. Many patients rely on reminders
could help save the time and amount of money
from their providers because of the convenience
we have to pay to get to the destination. Also, if
they provide, and automated reminders can save
the situation already happened, we can not
both time and money over the manual system you
change that but the hotel can find alternative
may be using.
ways to solve it. First, it should refund the
+ Allow Pre-Paid Appointments: Provide an
prepaid payment we made. This could help us
incentive for patients to show by allowing them to
find new hotels with less cost. Second, the hotel
prepay for their appointment. When patients know
may help us find close by accommodation, thus
they’ve already committed the money to an
has a suitable price, so we can settle down
appointment, their incentive to show is enhanced.
immediately.