Task 6.edited (1)
docx
keyboard_arrow_up
School
kabianga University College *
*We aren’t endorsed by this school
Course
1
Subject
Law
Date
Nov 24, 2024
Type
docx
Pages
4
Uploaded by DrElectronSardine35
1
Legal & Ethical Considerations
Students Name
Institutional Affiliation
Course
Instructor
Due Date
2
Legal & Ethical Considerations
A1.
Given the facts, the wisest course for the farmer and store would be to create an LLC (LLC).
A limited liability company enables business owners to minimize their responsibility. Each
partner's liability is limited to the amount invested in the business. Given the farmer's previous
experiences, he does not want to be as financially committed. This will give them the most
flexibility and allow the firm to get the required money from a small group of outside investors.
Additionally, forming an LLC protects against double taxes. This is the most adaptable and cost-
effective method of doing business. The farmer strives to prevent extraneous influences on
decisions relevant to the farmer's market, but the merchant prefers to be more decisive.
Taxation
- By forming an LLC, our partners, the farmer, and the retailer may elect to be
taxed as a corporation or partnership. Partners in an LLC are taxed individually.They are
optional to submit tax returns individually. Due to the fact that the business is an LLC,
the partners must additionally pay self-employment taxes. Therefore, they will be obliged
to file personal income taxes on their earnings, profits, losses, and bonuses using 1040
forms.
Liability
- The advantage of an LLC is that our partners are personally protected from
any asset losses and would not be responsible for any debts or liabilities should the firm
fail. Both members of the LLC have equal responsibility for any obligations that may
arise, but that duty is capped at the amount of capital each person has contributed to the
firm. After a few years in business, our partners hired a manager, which might be harmful
since it does not protect them from employee misconduct.
Ownership and Control
: Our partners are generally content with their decision to
preserve the company's controllability. Because of the fact that both partners have equal
3
ownership in the business, both parties also have equal influence over its operations. As
the firm grows, it may want to recruit additional partners, and they will need to maintain
cordial relations. In the event that investors are brought in, they will also have ownership
in the firm as well as influence over its operations.
A2.
The store owner wanted to incorporate the company. More parties would be engaged in the
decision-making process, and the farmer would have less direct control over his market as this
would have resulted in additional partners, it differs dramatically from what the farmer intended..
In addition, they must be state-chartered.
Taxation
- Similar to LLCs, corporations are taxed independently of their owners. If
there were stocks, there would be shareholders, which is one distinction. The proprietors
must thus record their income, bonuses, profits, and losses separately. Any dividends
issued to shareholders throughout the year would be subject to taxation.
Liability
-Its owners will make the company's decisions, and adding investors or
purchasing stock shares would increase the amount of available money. Shareholders in a
business have minimal responsibilities since they are solely accountable for their capital.
Ownership and Control:
Two or more shareholders would own and control the
company. Multiple investors may help generate capital and speed the attainment of
financial goals, which is more in line with the desired result for the store. The
disadvantage of having several persons participate in the decision-making process is that
selections may take longer.
B1.
In the scenario that was presented, the employer is in violation of the Fair Labor Standards
Act. The Fair Labor Standards Act provides an exhaustively detailed overview of the salaries and
working conditions that are applicable to the company's employees. The company does not pay
Your preview ends here
Eager to read complete document? Join bartleby learn and gain access to the full version
- Access to all documents
- Unlimited textbook solutions
- 24/7 expert homework help
4
overtime wages for extra hours worked and instead demands that employees fulfill milestones in
order to get full remuneration. This policy has been in effect since the beginning of this year.
None of these practices are authorized under the Fair Labor Standards Act, which prohibits child
labor among other things.
B2.
Identifying damaged and immature merchandise by general managers is an unethical
business practice. They plan to arrange the fruit and vegetable displays such that neither
customers nor the merchant would notice that they are imperfect. Even though farmers will not
get payment for unsold food, it is unethical for a merchant to deceive consumers. People might
have purchased it at a reduced price if it had been permitted to be sold as an "imperfect product."
C.
The workers have a moral duty to ensure that the quality of the goods produced is comparable
to the level of quality that is expected by the customers. Since the farmer has yet to participate in
all of the economic activities, he may be unaware. The managers must express their concerns to
the farmer and the retailer regarding the lack of a hand cart for moving the bulky produce boxes,
the request to present the products deceptively, and the retailer's involvement in a variety of other
questionable business practices not covered in this paper. Worst-case scenario, the merchant
takes offense and fires them, or the farmer gets more interested, and things turn around.