Question 1

Taxes and liability.

Accepted Answer

Two important considerations when choosing a form of business ownership is:

Question 2

Corporation.

Accepted Answer

The form of business ownership that usually requires the most detailed record keeping is the:

Question 3

Stockholder.

Accepted Answer

An owner of a corporation is known as a(n):

Question 4

Put the partnership agreement in writing.

Accepted Answer

When entering into a new partnership, a good strategy is to:

Question 5

Overwhelming time commitment often required of the owner.

Accepted Answer

A significant disadvantage of owning a sole proprietorship is the:

Question 6

Unlimited liability the owner has for the debts of the firm.

Accepted Answer

One of the major disadvantages of a sole proprietorship is the:

Question 7

Corporations can attract employees by offering stock options.

Accepted Answer

Which of the following is an attractive benefit of a corporation?

Question 8

To protect his/her other assets with limited liability.

Accepted Answer

The reason a professional such as a lawyer or doctor would incorporate his/her business is

Question 9

When you own your own business you are responsible for all the business debts.

Accepted Answer

Unlimited liability means:

Question 10

The responsibility of the owner.

Accepted Answer

Any debts or damages incurred by a firm organized as a sole proprietorship are:

Question 11

Lose their investment but nothing else.

Accepted Answer

Dane is a stockholder in SmallWorld, Inc., a C-corporation that manufactures amusement park rides. The company recently lost a major court decision and will probably be forced into bankruptcy. In fact, the damages awarded are so great that, even if all company assets are sold and the proceeds are used to pay its debts, SmallWorld is likely to still owe money to its creditors. If SmallWorld go bankrupt, Dane and the other stockholders will:

Question 12

Keeping all of the money she earns except for the taxes she is required to pay.

Accepted Answer

Maria has a lot of self-confidence and business knowledge. She recently opened a bakery as a sole proprietor. She is expecting a high level of profits and is looking forward to:

Question 13

Conglomerate merger.

Accepted Answer

When two companies in completely unrelated industries agree to become one firm, the result is called a:

Question 14

Vertical, horizontal, and conglomerate.

Accepted Answer

Three types of corporate mergers are

Question 15

Taking the firm private.

Accepted Answer

If a group of stockholders or management obtain all the stock of a previously publicly traded firm for themselves, this is referred to as:

Question 16

To expand within their own field or enter new markets.

Accepted Answer

One reason that companies participate in mergers and acquisitions is:

Question 17

conglomerate

Accepted Answer

When two firms who do not participate in the same industries, for example a software company and a fast food restaurant company decide to merge, the result is called a ____________ merger.

Question 18

Acquisition.

Accepted Answer

Modern Screen Entertainment, Inc., recently bought Star Power Pictures, Inc., for an undisclosed amount of money. It now owns all of Star Power Picture\'s properties and obligations. This is an example of a(n):

Question 19

No longer sold to investors on the open market.

Accepted Answer

When investors successfully take a firm private, the firm\'s stock is:

Question 20

taking the firm private

Accepted Answer

Adam is a major stockholder in Precision Transmission Services (PTS), a nationwide network of transmission repair shops founded by his father. Currently, PTS stock is sold on the open market, but Adam has talked to several relatives about his desire to get all of the PTS stock back in his family\'s hands. Adam is interested in _______________________________.

Question 21

accepting the risk of starting and running a business.

Accepted Answer

Entrepreneurship is:

Question 22

The sense of self-satisfaction and independence

Accepted Answer

Which of the following explains why individuals accept the risks of business ownership?

Question 23

believe in themselves and their ideas.

Accepted Answer

Successful entrepreneurs are self-nurturing. This means they:

Question 24

incubators

Accepted Answer

For the past twenty-five years, state and city governments have promoted facilities where new businesses can open-up shop and share common services such as secretarial, accounting, and legal services. Due to their remarkable success rate, _______________ continue to grow in popularity.

Question 25

they strive to take calculated risks.

Accepted Answer

Although successful entrepreneurs are more tolerant of uncertainty,

Question 26

is independently owned but not dominant in its industry.

Accepted Answer

The Small Business Administration defines a small business as a firm that:

Question 27

successful big businesses often create profitable opportunities for small businesses.

Accepted Answer

As a result of corporate downsizing, Alex lost his job as an information systems manager for a large telecommunications company. A bonafide computer geek in his own right, Alex knew that several of his past company contacts often outsourced their computer problems. He decided it was a good time to test the waters and see if he could secure enough computer clients to be in business for himself. His success demonstrated that:

Question 28

businesses with potential of high profit levels tend to be difficult to start and hard to keep going.

Accepted Answer

A review of small business successes and failures indicates that the:

Question 29

may be classified as a small business depending upon the size of other firms in the industry.

Accepted Answer

According to SBA guidelines, a manufacturing firm with 1,000 employees:

Question 30

many small business owners got their entrepreneurial idea from a previous job.

Accepted Answer

Conversations with people who start their own business often reveal that:

Question 31

Gain experience by working for a successful businessperson.

Accepted Answer

Which of the following suggestions would an experienced business owner offer to help someone who is thinking about starting a business venture?

Question 32

meet with experienced entrepreneurs and learn from their advice.

Accepted Answer

A small business management course at a community college may offer entrepreneurs an opportunity to:

Question 33

business plan

Accepted Answer

A __________ is a written document that details the business idea, the target market and the business\'s competitive advantage, financial resources available for the business, and the qualification of the management.

Question 34

have both a willingness to buy and the financial resources needed to buy.

Accepted Answer

To be considered part of a market, an individual must:

Question 35

Other prospective small business owners

Accepted Answer

Which of the following is a poor recommended source of small business advice for persons contemplating a new business?

Question 36

the Service Corps of Retired Executives.

Accepted Answer

The Small Business Administration sponsors volunteers from industry, trade associations, and education who offer advice to small business owners. These volunteers are called:

Question 37

the plan enables Demitri to think carefully about all aspects of his business idea.

Accepted Answer

In order to improve his chances of small business success, Demitri prepared a business plan. Most often, a positive outcome of this exercise is:

Question 38

expect the entrepreneur to provide a business plan.

Accepted Answer

Entrepreneurs applying for a bank loan should realize that bankers will:

Question 39

her business plan

Accepted Answer

In order to finance The Shortbread Shack, a mobile bakery business that services several large Silicon Valley companies, Marcy demonstrated her steadfast desire to get her bakery off the ground by visiting several bankers with _____________.

Question 40

technological advances such as the Internet and PayPal for safely fulfilling orders

Accepted Answer

Increased participation in small business exporting owes credit to _________.

Question 41

Managers, owners, creditors, employees, and the government

Accepted Answer

Which of the following responses is the best and most comprehensive? \"A company\'s accounting information is useful to _____________.\"

Question 42

To provide financial information that is useful to decision makers.

Accepted Answer

Although accounting has several specific uses, the overall purpose of accounting can be summarized as:

Question 43

Summarizing information in order to create reports and financial statements

Accepted Answer

Which of the following is an area of importance in accounting?

Question 44

Summarizing and interpreting financial information needed by his firm\'s managers.

Accepted Answer

As an accountant, Joe Billings responsibilities include:

Question 45

Auditing and managerial accounting

Accepted Answer

The accounting profession is divided into 5 key working areas, two of which are:

Question 46

annual report

Accepted Answer

A(n) _________ is a yearly published statement of the financial condition, progress and expectations of an organization.

Question 47

Financial accounting.

Accepted Answer

Kelley\'s Kloset, LLC has applied for a business loan. Her prospective banker has requested information concerning the financial condition of her business. Which accounting discipline is responsible for providing accounting information to outside stakeholders?

Question 48

managerial accountants

Accepted Answer

As U.S. firms focus on cost cutting in order to stay competitive with producers in low-wage countries, they will rely on __________ to create strategies to help reduce costs.

Question 49

accounting cycle

Accepted Answer

The __________ is a six-step procedure that results in the preparation and analysis of the major financial statements.

Question 50

Separate all of the firm\'s transactions into meaningful categories.

Accepted Answer

A bookkeeper\'s first task is to:

Question 51

Recording information into journals

Accepted Answer

Which of the following is a key step in the accounting cycle?

Question 52

Trial balance

Accepted Answer

Heather works in the accounting department of Colorado Manufacturing. Today she will use the firm\'s ledger to summarize information that was posted over the most recent time period. Her goal is to determine if the accounts are balanced as required by the double-entry method of bookkeeping. To be sure they are correct, Heather will prepare a(n):

Question 53

liabilities

Accepted Answer

Debts owed by a business are called ___________.

Question 54

Assets.

Accepted Answer

Resources that a firm owns are called:

Question 55

Current assets

Accepted Answer

Company resources that are purchased with the intention that they will convert to cash within one year are:

Question 56

Assets = Liabilities + Owners\' equity.

Accepted Answer

The balance sheet is set up to reflect the Fundamental Accounting Equation. This equation shows:

Question 57

assets.

Accepted Answer

As Hector was packing to return to State University after his summer vacation, he realized that he owned many valuable things such as a laptop computer, a stereo system, and a DVD player. An accountant would list all of these as Hector\'s:

Question 58

A company\'s ability to earn a profit over time

Accepted Answer

A company\'s income statement is important to accountants and other stakeholders. It reveals:

Question 59

Should be compared to other firms in the same industry.

Accepted Answer

In order to understand if the results of ratio calculations indicate a financially strong company, the results:

Question 60

liquidity

Accepted Answer

The current ratio is a type of ________ ratio.

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