Should a multi-type entity (local business that provides a service) be contained in "provider"?

Question

Which is considered best practice for writing multi-typed entity in JSON-LD for a local business that provides a service?

  "@context": "http://schema.org",
  "@type": ["LocalBusiness","Service"],
  "image": "https://www.pullapart.com/media/1341/logo_large.png", 
  "name": "Pull-A-Part Lithonia - Cash for Cars",
  "url": "https://www.pullapart.com/sell-my-car/locations/georgia/atlanta-east/",
  "sameAs":"https://plus.google.com/u/0/109300607691231001649/",
  "address": {
    "@type": "PostalAddress",
    "addressLocality": "Lithonia",
    "addressRegion": "GA",
    "streetAddress": "6513 Marshall Boulevard"
    },
  "areaServed": {
    "@type": "City",
    "name": "Lithonia, Roswell, Alpharetta, Lawrenceville, Monroe, McDonough, Decatur, College Park, Conyers"
  },
  "description": "Sell your junk car for cash in Lithonia at Pull-A-Part.",
  "hasMap":"https://www.google.com/maps/place/Pull-A-Part/@33.7349021,-84.1231084,15z/data=!4m5!3m4!1s0x0:0x2169e25421f1efcd!8m2!3d33.7349021!4d-84.1231084?sa=X&ved=0ahUKEwidwYPivtnVAhWCYyYKHTJoAKoQ_BIIyAQwZA",
  "telephone": "678-245-4843",
  "serviceType": "Buying junk cars for cash"

or

  "@context": "http://schema.org",
  "@type": "Service",
  "serviceType": "Buying junk cars for cash",
  "provider": {
    "@type": "LocalBusiness",
    "name": "Pull-A-Part Lithonia - Cash for Cars",
    "image": "https://www.pullapart.com/media/1341/logo_large.png", 
    "url": "https://www.pullapart.com/sell-my-car/locations/georgia/atlanta-east/",
    "sameAs":"https://plus.google.com/u/0/109300607691231001649/",
    "telephone": "678-245-4843",
    "address": {
      "@type": "PostalAddress",
      "addressLocality": "Lithonia",
      "addressRegion": "GA",
      "streetAddress": "6513 Marshall Boulevard"
      },
    "areaServed": {
      "@type": "City",
      "name": "Lithonia, Roswell, Alpharetta, Lawrenceville, Monroe, McDonough, Decatur, College Park, Conyers"
      },
    "hasMap": "https://www.google.com/maps/place/Pull-A-Part/@33.7349021,-84.1231084,15z/data=!4m5!3m4!1s0x0:0x2169e25421f1efcd!8m2!3d33.7349021!4d-84.1231084?sa=X&ved=0ahUKEwidwYPivtnVAhWCYyYKHTJoAKoQ_BIIyAQwZA"
  }

Answer 1

An MTE is one entity with multiple types.

Your first JSON-LD snippet describes an MTE, because the top-level object has two types (LocalBusiness and Service).

Your second JSON-LD snippet doesn’t describe an MTE, because no object has more than one type.

If you think it makes sense that the business is the very same thing as the service this business provides, then you can use both types together. But usually these are of course separate things (and separating them allows you to be more precise and flexible), and you would connect them via the provider property and/or the hasOfferCatalog property.