QUESTION 2 (350

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450 WORDS)

Andrew is running a successful consulting business. He initially set up his business as a sole

proprietor. In the last 2 years, Andrew's business has been doing very well and generated over

$250,000 in revenue. Last month Andrew signed up two major corporate clients that will likely

bring money to his business. Andrew is wondering if he should continue to run his business as a

sole proprietor or he should incorporate. With that in mind, please explain what is meant by

corporation having a separate legal identity? Explain some of the advantages and disadvantages

associated with the corporate method of carrying on businesses.

In addition, please explain if Andrew should run his business as is or should he incorporate. Give reasons for your answer.