LB573 BUSINESS LAW 2 ASSESSMENT Level 6

Submission Deadline: 08 December 2023 16:30 [UK Time]

I certify that the assessment submission is entirely my work, and I have fully
referenced and correctly cited the work of others, where required. I also confirm the
contents of my submission have not been generated by a third party, or through an
Artificial Intelligence generative system.

I have read the Student Discipline Regulations and understand any Assessment
Related offence / Academic Misconduct can lead to consequences.

By submitting this assessment submission, I am confirming that I am fit to sit

according to the Assessment Regulations.

ASSESSMENT INSTRUCTIONS

 You must produce your assessment answer in Word.

 Your answer must not exceed 2000 words. Words in excess of the limit will not
be marked.
 State your word count at the end of your answer.
 Type your candidate number on each page of your answer.
 Save your coursework with the file name: candidate number- Business_Law2
 Follow the submission instructions as set out in your Module Assessment
Student Instructions.

LEARNING OUTCOMES

For this Assessment you will be assessed against the following Learning Outcomes:

1. Demonstrate knowledge and understanding of principles relating to the finances

of business entities, financial regulation, and the insolvency regime, and the
broader context within which the law operates.

2. Critically analyse complex actual or hypothetical problems and evaluate a range

of solutions in the light of the legal issues raised and make critical judgments on
the merits of particular arguments.

3. Utilise and evaluate data presented in numerical form and derive appropriate
conclusions.

4. Undertake directed and self-directed research to retrieve and evaluate accurate,

current and relevant information from a range of sources.

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5. Devise and sustain a legal argument, recognising ambiguity and synthesis, using
tailored evidence in writing and be able to community these to specialist and non-
specialist audiences.

6. Communicate clearly and concisely, using correct grammar and spelling, and
using appropriate technical legal language where necessary.

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Questions – please answer ALL questions 1, 2(a) and 2(b)

QUESTION 1

Cablecore Ltd is a private company limited by shares. The company manufactures

cable for use in electrical appliances and machinery and in particular heating and
thermal protection cables.

The company was set up 12 years ago by Dennis Lao, Ngolo Weekes and his father
Fabian Weekes. Dennis and Ngolo run the business. Fabian does not work in the
business but he invested in the business when it was starting out.

The company has an issued share capital of 100,000 ordinary £1 shares. The
directors and shareholders are as follows:-

Name Directorships Shareholding

Dennis Lao Managing Director 25,000 ordinary £1 shares
Ngolo Weekes Finance Director 25,000 ordinary £1 shares
Fabian Weekes N/A 50,000 ordinary £1 shares

The company is expanding and needs money to fund its expansion. The directors
want to borrow £100,000 from the company’s bank which would be secured by a
fixed charge over its business premises (it owns its premises outright). The directors
would like to borrow this money as soon as possible.

As part of its expansion the directors want to appoint Solomon Aziz as Sales
Director. Solomon has worked for the company for four years already and this
appointment is to recognise and reward his contribution to the company and to
secure his commitment to the next phase of the company’s growth. Dennis and
Ngolo see Solomon as integral to their plans and would like to give Solomon a fixed
term contract for three years. They have discussed this in principle with Fabian and
he supports the idea. They would like to appoint Solomon as soon as possible but
they have agreed that his appointment will start at the same time as his service
contract starts.

The company has Model Articles for private companies and these have not been
amended.

Wherever possible the shareholders use written resolutions.

Explain the procedural steps required for the company to implement its
expansion plans as soon as possible. In your advice you should identify (and
explain the reasons for) each of the resolutions needed, how they could be
passed, and what associated administration would be needed.

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QUESTION 2

Part (a)

Peter Gregorski is in business as a sole trader providing gardening services to

residential and business clients.

This year Peter’s income from the gardening business is £85,000. Peter spent £280
on waste disposal licenses, £127 on insurance, and £2,900 on petrol for his petrol
chainsaw and lawnmower. He also invested in some new tools and machinery
including a garden tractor that cost £3,200, a cut off saw that cost £399 and a
strimmer that cost £249.

Peter owns a transit van that he uses for work. At the start of this financial year the
van had a book value of £12,000.

The gardening business is Peter’s only source of income.

Using the 2022/23 tax rates explain how much income tax Peter will have to pay
this year.

Note to students: when considering capital allowances you need only discuss
whether Peter qualifies for those capital allowances available in respect of
plant and machinery.

Part (b)

For several years Peter used a garage on Bowker Road to store his tools and
equipment. He bought the garage in July 2015 for £10,000 and spent £1,450 on legal
fees. In September 2023 Peter sold the garage for £18,000. The legal fees on the
sale were £800.

In October 2023 Peter bought a new storage unit on the Lansdowne Estate which he
now uses to store his tools and machinery.

Calculate and explain Peter’s capital gains tax liability in the light of these
transactions.

Note: You may assume that Peter will claim any reliefs available.

The total word count for all questions should NOT exceed 2000 words. Any
words over this total will not be marked.

(100 marks)

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