Name: Dawn Juliana Aran Subject: Business Ethics and Social Responsibility

Grade & Section: 12-OLLS Date Accomplished: 02/27/2022

Case Study: Abakada Company

Guide Questions:

Based on the situation above, give the owner of Abakada appropriate advice regarding whether
or not to incorporate his business. You might wish to categorize the pros and cons into the
following.

1. business size Issues;

2. Issues related to mission and objectives;
3. procedures for incorporation;
4. personnel issues;
5. control issues;
6. funding sources issues; and
7. legal and tax issues.
 Pros Cons

In case that proprietor will incorporate the He needs to require a lot of

Abakada Company, he will get a lot of funds
Business Size that could make his business larger that could
Issues produce bigger earnings or profits than the
usual company income when it is still a small
enterprise.
colleagues or shareholders that
he needs to pay, or sharings of
earnings of the company.

Compared to the small

enterprise, the business will have
Issues Related bigger responsibilities to handle
to mission and Because of larger aims and objectives, Sales so they need to prepare new
objectives and profit will increase. strategies for the company. New
revision of mission and objectives
is recommended.

The incorporation process necessitates The procedures to incorporate

strategic preparation and a thorough requires a lot of time for the
Procedures for understanding of business filing procedures. business because the corporation
is not an easy formation form of
incorporation So interpreting incorporated procedures are
business.
needed to have a successful launch of a new
form of their business ownership.

He will have a helping hand to manage his Additional Expenses are required
Personnel business which is his co-workers. because he needs to pay them
Issues through salary. He also has trust
issues with them.

He will have assistance to manage and
control the company compared to the
Control Issues proprietorship form of business. He is the one
who is responsible to do all the
responsibilities that he needs to do for the
company.
He will have limited life because
now he will have shoulders that
will help him to manage the
business.

Funding It will be easy to access funds. Increased bank loans.

Sources Issues

There are a good deal of shareholders who There are additional taxes that
could help him to shoulder bigger taxes that the company needs to finance
Legal and the company needs to pay. compared to the proprietorship
Taxation Issues and partnership that do not have
additional taxes.
 The advice that I can give to the owner of Abakada Company is to consider all the factors (that
we can see above) that need to be handled. If he thinks being incorporated will be better for the
company then be it. In my opinion, it is better that the Abakada company will be incorporated,
being a corporation that can attain larger capital and income. Also, there’s a lot of sources of
funds that can help the business to be successful. Just be prepared and adapt to all the
changes that will happen in the company.