D078 TEM1 - Business Environment Applications I: Business Structures and Legal Environment - Legal and Ethical
Considerations, Task 2
D078 TASK 2
Name:
Student ID:
D 0 7 8 T as k 2 - L e g a l S t r u c t u r e s I n B u s i n e s s E n v i r o n m e n t
A. Applications I | Questions And Answers, Latest Update | 100%
Correct Answers | Graded
1.
(A1) For the type of company the farmer and supermarket retailer are trying to
establish in their farmers market, I believe opting for a Limited Liability Company
(LLC) works best. This structure allows both parties to be equal partners and share
profits and losses while protecting them from paying double taxation and allows
them both to be protected legally.
• taxation – The LLC structure allows for flexibility when the partners decide how
they want to be taxed. An LLC can be taxed like a partnership or a sole
proprietorship. It would benefit the farmers and the supermarket retailer to file as a
partnership because it would prevent double taxation.
• Liability – An LLC provides the partners with liability protection that usually comes
with a corporation but allows for more flexibility. This protects the farmer and the
supermarket retailer from any lawsuit regarding employee injury. This keeps their
personal assets separate from the company.
• ownership and control – An LLC structure allows partners, the farmer and
supermarket retailer, complete control over the business. It will enable them to add
more partners in the future if needed. The farmer’s market company is run like a
manager-manager, allowing the farmer to control who can or cannot become a
partner.
2.
(A2) Another option for the farmer and the supermarket retailer framers market
business is a general partnership. A general partnership will allow both partners to
have control over their parts of the company and share profits, losses, and liabilities.
• taxation- In a general partnership, income is shared between both partners. When
the farmers market company fills their taxes, they file with the partner’s personal
income tax rates.
• Liability- A general partnership allows partners to be personally liable for all debts
and management duties. This means that the framer and the retailer are personally
responsible for making decisions for the company and any acts of malpractice.
Considerations, Task 2
D078 TASK 2
Name:
Student ID:
D 0 7 8 T as k 2 - L e g a l S t r u c t u r e s I n B u s i n e s s E n v i r o n m e n t
A. Applications I | Questions And Answers, Latest Update | 100%
Correct Answers | Graded
1.
(A1) For the type of company the farmer and supermarket retailer are trying to
establish in their farmers market, I believe opting for a Limited Liability Company
(LLC) works best. This structure allows both parties to be equal partners and share
profits and losses while protecting them from paying double taxation and allows
them both to be protected legally.
• taxation – The LLC structure allows for flexibility when the partners decide how
they want to be taxed. An LLC can be taxed like a partnership or a sole
proprietorship. It would benefit the farmers and the supermarket retailer to file as a
partnership because it would prevent double taxation.
• Liability – An LLC provides the partners with liability protection that usually comes
with a corporation but allows for more flexibility. This protects the farmer and the
supermarket retailer from any lawsuit regarding employee injury. This keeps their
personal assets separate from the company.
• ownership and control – An LLC structure allows partners, the farmer and
supermarket retailer, complete control over the business. It will enable them to add
more partners in the future if needed. The farmer’s market company is run like a
manager-manager, allowing the farmer to control who can or cannot become a
partner.
2.
(A2) Another option for the farmer and the supermarket retailer framers market
business is a general partnership. A general partnership will allow both partners to
have control over their parts of the company and share profits, losses, and liabilities.
• taxation- In a general partnership, income is shared between both partners. When
the farmers market company fills their taxes, they file with the partner’s personal
income tax rates.
• Liability- A general partnership allows partners to be personally liable for all debts
and management duties. This means that the framer and the retailer are personally
responsible for making decisions for the company and any acts of malpractice.
