In the former situation, the computer shop is liable for all debts, and Tom enjoys limited liability. If all the assets of the computer shop cannot clear off the debts, business bankruptcy is a possible outcome, and Tom’s personal saving and home can be protected even the lawsuit is filed against his shop.
In the latter situation, Tom and the computer shop are regarded as the same. Tom is fully liable for all the debts and liabilities of the computer shop. That is to say, Tom is personally liable for all the risks, debts and liabilities of their firms. As stated in the case, Tom has to bear all the HK$1,200,000 debts and all his personal assets would be involved without limited in any legal action taken against his shop. Since all the assets of Tom cannot clear off the debts, there are two possible outcomes: first, Tom can only borrow money from someone else to pay off the debts and ask for compensation from the computer shop or other shareholders if there is any; or Tom can apply personal bankruptcy.(责任编辑：BUG)