question

Balloon payment

answer

Is due when a loan cones due

question

Net cash flow

answer

Is the difference btwn cash inflows and cash out flows

question

Forecasting sales for a new venture

answer

Is extremely difficult

question

A___is defined as a group of customers or potential customers who have purchasing power and unsatisified needs

answer

Market

question

Failure to take cash discounts from suppliers

answer

Typically makes a big difference to a firms financial well being since a business pays a high rate for use of suppliers money

question

The assets most commonly used for security by asset based lending companies are

answer

Accounts receivable and inventory

question

Which of the following is not a right of a common stock holder (shareholder) of a corp.

answer

Attend board of directors meeting

question

The purchase price of a business is determined by negation between

answer

Buyer and seller

question

If bill Bailey owner had violated the convenants of his loan agreement

answer

The lender could have declared the loan due in full immediately

question

Which of the following is marketing strategies was not discussed in leacture notes

answer

bivaruate strategy

question

A firm that provides substancial profits to its owner is called a

answer

attractive small firm

question

Accounts receivable financing might include

answer

pledging receivable and factoring

question

In laws create complications in a famly business

answer

bc more family members become involved in the firm the more difficult the fairness issues becomes

question

Cumulative deprecation expense is shown on the

answer

balance sheet

question

a SWOT analysis can be described best as

answer

a concise overview of the firms strategic situation

question

the "bottom line" of the income statement is affected by all of the following except

answer

dividend paid to owners

question

The terms 3.10, net 30 offer

answer

a 3% discount on a purchase paid within 10 days

question

Stakeholders in a business are made up of which of the followinf

answer

owners, customers, employees

question

Which of the following is not directoly involved in a firms management of its working capital

answer

Fixed assets

question

Individuals who have entered busines as a result of finincial hardship or other severe negative conditions are called ___ enterpreneurs

answer

reluctant

question

Which of the following choices contains a C that is not one of ther traditional five Cs of credit

answer

capital, collateral, consistency

question

The federal govet assists in providing funds to smalll businesses through

answer

the small business administration

question

A business plan is best described as a

answer

game plan

question

The debt ratio is determined by dividing the firms total debt by the total

answer

assets

question

Ch. 1 states that an enterpreeur is a person who does all the following except

answer

manages a small business for a salary

question

The 3 primary rewards or incentives for entrepreneures are

answer

independence, personal fulfillment and profit

question

The __ shows the results of a firms operations over a period of tim, usually one year

answer

income statement

question

Which of the following sequences of events reflects a portion of the accouncting/bookkeeping process or cycle

answer

Analyzing economic activities, journalizing transactions, post, preparing a trial balance and preparing finincail statements

question

A leveraged buyout involves a high level of ___ financing

answer

debt

question

a person who starts a bnusiness is classified as a

answer

founder

question

If a firms current ratio imporves from 1.5 to 2.0 what has likely happened

answer

Current liabilities have decreased

question

Compared to firms that provide a good lifestyle for the owner but little in the way of attractibe returns, a form with potential for high growth and large profits has ___possible sources of financing

answer

many more

question

The following are key terms included in all bank loan agreeements except

answer

insurance coverage

question

In order to derive a cash flow statement, starting with the income statement the owner must add back in

answer

depreciation expense

question

The ratio that compares the toalt of all current assests with the total of all current liabilities

answer

Current ratio

question

Small businesses that have great prospects for growth are called

answer

gazelles

question

When a funeral dorector buys a hearse with 100% bank financing she would

answer

Dr. Hearse and Cr., Note payable

question

Granting credit to customers

answer

directly affects a firms cash account

question

In considering its marketing strategy a new venture will typically concentrate on

answer

a select few target markets or just one

question

The excutive summary in a business plan should come

answer

at the beginning

question

An entity or individual granted the right to conduct business according to specified methods and terms of another party is known as a

answer

franchisee

question

Financial analysis

answer

two of the above

question

An example of a current asset is

answer

inventories

question

The executive summary part of a business plan should be written

answer

last

question

The group of accounts which you credit to increase are

answer

liabilities and capital

question

The process of preparing a family successor for leadership in the family business often takes

answer

a decade or longer

question

Ethical issues

answer

are questions of right and wroing

question

The group of accounts which you debit to increase are

answer

assets and expenses

question

When bankers look for evidence of whether an existing business will be able to repay a loan they usually base their assessments of this on

answer

what the firm has done in the past

question

An accounting year ending on some date other than Dec 31st is called

answer

fiscal year

question

The income statements reports financial information related to the following broad areas of business except

answer

accumulated depreciation

question

The major distinction between cash basis and accrual basis accounting is that the

answer

point of recognition of revenue and expenses is different

question

Different types of small business ownership opportunities include all of the following except

answer

bailouts

question

Business planning

answer

is an ongoing process

question

A loan covenant is very unlikely to require

answer

a fixed business strategy

question

The two broad syratigies for building a competitive advantage are the ___ stratigies

answer

cost based and differention based

question

The ethical infludence of a leader of a small business is

answer

more pronounced than that o a leader of a large corporation

question

In comparesion to the general population, entrepreneurs have a

answer

higher internal locus of control

question

The amount of the business owners initial investiment owners later investment in the business and retailed earings comprise

answer

owners equity

question

Drawbacks of selling stick as a source of funds include

answer

loss of voting control of the company

question

Money paid for the use of money is called

answer

intrest

question

Which of the following is/are vaild techniques for valuing a company

answer

Asset-based valuation, market-comparable valuation and cash flow based valuation

question

The title of an account that normally has a credit balance is

answer

accounts payable

question

Net cash flow and net profit are

answer

different

question

The bok value of a depreciable assest

answer

decreases over time

question

The method of determining an average that applies more weight to the most recent year and less weuight to each preceding year is callled

answer

recency weighted average method

question

To retain control over his business, an enterpreneur should seek initially to secure __ financing

answer

debt

question

The purches of office supplies on credit is recorded by

answer

Dr, office supplies and Cr. accounts pay

question

The tradeoffs that must be understoof between debt or equity financing include the following except

answer

return on assests

question

The process of recording information in the ledger is called

answer

posting

question

Managment of working capital focuses attention on

answer

cashe, accts receivable, inventory and accts pay

question

The primary advantage an enterpreneur gains by leasing raher than buying facilities is

answer

a decrease in investment risk

question

Which of the foloiwing is not one if the basic objectives of the businessw plan

answer

it outlines the approaches other emterpreneurs have taken in the same industry

question

In a fmaily business the interests of the family and the interests of the business are best described as

answer

overlapping

question

The equation "sales - expense = profits" would reperesent which finicial statement

answer

cash flow

question

If a firms current ration __, its liquidity ___

answer

Increases; decreases

question

When a business sells its accounts receivable to a finance company, this is called

answer

factoring

question

Lifestaye businesses are so caled bc they achieve all but which one of the following

answer

promote an easy going, unstressful lifestyle

question

Instead of corrowing money from equipment suppliers or a bank to purchase equipment, an increasing number of small businesses are

answer

chosing to lease the equipment

question

In terms of willingness to assume risks, entrepreneurs show

answer

moderate risk taking propensity

question

A primary benifit deriving from the strength of family relationships is the willingness of fmaily member

answer

sacrifice salaries and dividens when necessary

question

Primary data collection methods are often classified as

answer

observational or questioning

question

Slow paying credit accounts

answer

tie up the sellers working capital

question

Which would be an example of an employee acting unethically toward an employer

answer

Taking unjustified sick leave

question

The accounting concept of Materiatly is

answer

measured by whether or not the manner in which the item is treated or reflected

question

Internal control policies and procedures are designed to

answer

Encourage adherence to the policies established by management

question

Assuming that cash is avaliable payment for an acct pay with terms of 3/10 net 30 should be made on day

answer

10

question

The accounting equation is best described as

answer

Assests plus expenses plus dividens plus losses eaquals liabitiles...

question

Which of the following groups would be most interested in a business plan for a new venture

answer

bankers

question

An example of a type C startup idea is

answer

baby stroller that pushes more easily and diffulct to over turn

question

Which of the following dose not indicate a focus strategy

answer

Concentration on a single product

question

The triditional physical store is sometimes referred to as the __ store

answer

bricks and mortar

question

If a firm finances with equity rather than debt, net income will be greater bc

answer

There is no interest expense

question

As described in the textbook, a type A idea involved

answer

providing customers with a product or service absent in their market but avaliable elsewhere

question

Opportunistic entrepreneurs exhibit which one of the following traits

answer

plan for future growth

question

Fixed assets include

answer

land

question

An example of a fixed asset is

answer

a delivery truck used by a grocer to deliver merch to customers

question

Harvesting refers to

answer

exiting a busines

question

On the balance sheet, for every dollar of assets there must be a dollar of financing in the form of debt or

answer

owners equity

question

Accts pay __ cash avaliable for the firm

answer

increase the amount of

question

Which of the following is a true statement about location decisions

answer

Location decisions have an enduring effect on business operations

question

The finincial statement showing what is owned, what is owed and the owners equity on a specific date is

answer

balance sheet

question

The __ shows all cash receipts and payments involved in operation the business and managing its finincial activities

answer

cashe flow statement

question

The marketing plan should innclude

answer

a competitor analysis

question

An over view of the significant points of a business plan appear in the

answer

executive summary

question

The type of finincial statement analysis that utilizes more that one year of finincial data is/are

answer

Horozontal analysis

question

The liquidity of a firm is

answer

often measured by a ration of current assests to current liabilities

question

Temptations and pressures to act unethically are such that small firms are

answer

more bulnerable that large fimrs

question

The totaling of a column in a hournal or ledger account is called

answer

footing

question

A family retreat is desigened to

answer

bring fmailuies together to discuss business matters

question

As long as a fimrs rate of return is greater than the cost of the debt the owners rate of return on equity will __ as the firm uses more bedt

answer

increases

question

Other assets include

answer

goodwill

question

Which of the following is classified as an entrepreneur

answer

An owner manager who bought out the founder of a firm

question

Accordiung to lecture if a business has an average collection oeriod of accounts receivable of 45 days the business should have a current ration of at least

answer

1.7 : 1

question

After their first day Ashely and Canmeroin profits were $45 but their cash increased by only $30 bc their __ also increased

answer

accts. receivable

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