Problem $18-4($Algorithmic$)($LO$.2,3)$

Sea Green Enterprises reports the following assets and liabilities on its balance sheet:

$$Net Book ValueFair Market ValueAssets$$400,000$$$600,000$Liabilities$120,000120,000$

Sea Green just lost a product liability suit with damages of $$6,000,000$ being awarded to the plaintiff. Although Sea Green will appeal the judgment, legal counsel indicates the judgment is highly unlikely to be overturned by the appellate court. The product liability insurance carried by Sea Green includes a payout ceiling of $$3,600,000.$

Assume any net assets of the company will be used to reduce the judgment.

Forhow much of the judgment is the entity and its owners liable if Sea Green is a sole proprietorship, a partnership, an LLC$,$ a C corporation, and an S corporation?

If an amount is zero, enter $"0".$

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a$.$If the form of the business entity is a sole proprietorship, the owner is ultimately liable for $fill in the blank $3$caa$6$a$056$f$82035\_1.$

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b$.$If the form of the business entity is a partnership, the partnership and the general partners are ultimately liable for $fill in the blank d$57$d$8$e$04$ff$9601$b$\_1.$

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c$.$If the form of the business entity is a limited partnership, it must have at least one

generallimited

partner liable for partnership

assetsdebts

$.$ The

generallimited

partners can lose only their investment.

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d$.$If the form of the business entity is an LLC$,$ it will be liable for the entire $fill in the blank $31$e$8$b$7$ff$305$cf$9$a$\_1$ not covered by insurance. However, all of the owners of an LLC

areare not

protected from all of the LLC$$s liabilities. Therefore, the LLC members

havehave no

personal liability for any debts the LLC is unable to pay.

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e$.$If the form of the business entity is a C corporation, the C corporation has limited liability of

$$0$$$400,000$$$600,000$$$2,400,000$

$.$ The plaintiff

can sue the shareholders for any unpaid liabilitywill share with the other creditors with respect to claims against the assets

$.$ The shareholders of the C corporation

are liablehave no personal liability

for the remaining corporate debts.

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f$.$If the form of the business entity is an S corporation, the S corporation and its shareholders are treated like

a partnership in part $($b$)$a C corporation in part $($e$)$

$.$