WGU D078: Task 2 with Complete Solutions
1. Corporation
• Tax: Corporates are legal entities with the same rights as individuals.
Corporates are graded entities that pay taxes on their own income. With a
corporation being its own entity and paying its own taxes, owners and
shareholders also have to pay their own taxes on profits or dividends; this
creates a double tax.
• liability: Corporations pose less liability to shareholders based on the amounts
they have invested in the corporation. This lower liability gives investors and
farmers less liability when starting their new venture. The legal entity aspect of
the corporation protects the personal assets of the shareholders and farmers if
the corporation goes into debt or is sued.
• ownership and control: Corporations are ran by a board of directors who the
shareholders decide upon. The corporation's ownership is shared between the
farmers, shareholders, and the supermarket. The control over the directors and
decision-making would come from who has the most shares or money invested
into the corporation. However, the individual with the most shares must still report
to the appointed board of directors.
2. Limited Liability Company (LLC)
• taxation: Limited Liability Companies are known as flow-through entities, which
means that once the LLC has paid all its expenses, the owners will pay tax on
any remaining revenue at the individual level. This entity avoids the double tax
we see with a corporation, which could benefit retailers and farmers by lowering
their taxes.
• liability: Limited Liability Companies are, as their name suggests, limited
liability entities. The members of the LLC would have their assets protected from
any debts or liabilities that the LLC accrued. The LLC is an appealing entity for
the farmer concerned about the financial loss he has experienced in the past.
• ownership and control: Limited Liability Companies are more flexible in
ownership than corporations. They can structure their company with specific
1. Corporation
• Tax: Corporates are legal entities with the same rights as individuals.
Corporates are graded entities that pay taxes on their own income. With a
corporation being its own entity and paying its own taxes, owners and
shareholders also have to pay their own taxes on profits or dividends; this
creates a double tax.
• liability: Corporations pose less liability to shareholders based on the amounts
they have invested in the corporation. This lower liability gives investors and
farmers less liability when starting their new venture. The legal entity aspect of
the corporation protects the personal assets of the shareholders and farmers if
the corporation goes into debt or is sued.
• ownership and control: Corporations are ran by a board of directors who the
shareholders decide upon. The corporation's ownership is shared between the
farmers, shareholders, and the supermarket. The control over the directors and
decision-making would come from who has the most shares or money invested
into the corporation. However, the individual with the most shares must still report
to the appointed board of directors.
2. Limited Liability Company (LLC)
• taxation: Limited Liability Companies are known as flow-through entities, which
means that once the LLC has paid all its expenses, the owners will pay tax on
any remaining revenue at the individual level. This entity avoids the double tax
we see with a corporation, which could benefit retailers and farmers by lowering
their taxes.
• liability: Limited Liability Companies are, as their name suggests, limited
liability entities. The members of the LLC would have their assets protected from
any debts or liabilities that the LLC accrued. The LLC is an appealing entity for
the farmer concerned about the financial loss he has experienced in the past.
• ownership and control: Limited Liability Companies are more flexible in
ownership than corporations. They can structure their company with specific
