BUS 101 Test 2

Which of the following statements correctly describes the difference between the way S corporations and C corporations are taxed?

An S corporation is taxed like a partnership, while a C corporation faces double taxation.

Which of the following best describes a company's assets?

Anything owned of value by a company

The fundamental accounting equation is:

Assets = Liabilities + Owner's Equity

A company's current assets and current liabilities are found in its ________.

Balance sheet

Which is not considered a key disadvantage of starting a franchise?

Brand awareness

________ are a special type of partnership between two or more companies in different countries that share many parts of the business, including technology, costs, profits, and risks.

International joint ventures

Which of the following is considered to be a current asset?

Inventory

Job applications, personality assessments, and intelligence tests are all examples of ________.

validated selection tools

Which of the following is not a vital role for managerial accountants?

Adhering to U.S. government requirements

________ are products produced abroad and bought domestically.

Imports

________ is the idea that countries and businesses should specialize in the production of goods in which they have a lower opportunity cost.

Comparative advantage

________ allows a company to access international markets by simply allowing a foreign company the ability to produce its product.

Contract manufacturing

360-degree performance appraisals rely on the ratings from one rater.

False

A sole proprietorship is the most complex form of business.

False

All earnings of a sole proprietorship are treated as corporate income.

False

Suppose Vietnam has an absolute advantage in the production of all goods compared to its neighbor Laos. Because Vietnam is more productive in all areas, it is not in its best interest to enter into a trading relationship with Laos.

False

________ accounting is the branch of accounting that centers on the needs of external stakeholders.

Financial

The set of standards that govern accounting in the United States are known as ________.

Generally Accepted Accounting Principles

________ are limits on imports from a country.

Quotas

________ are taxes on imports.

Tariffs

A company sold stock in return for cash. Which of the following statements most correctly states the transaction's impact on the company's balance sheet?

The company's cash increased, and the company's owner's equity increased.

Benefits associated with using social media to advertise jobs in a company include

the ability to provide job seekers insight into the company, its people, and its culture.

Which of the following is not a reason that countries may pursue trade protection?

To increase imports

Why does the government oversee and regulate mergers and acquisitions?

To maintain competition between companies

A partnership may have more than two owners.

True

Attitude, task performance, accident rates, and interpersonal impact are commonly assessed performance dimensions.

True

Current assets refer to those things are owned by a company that are either cash or expected to be turned into cash in the near-term.

True

If China and the United States have a trade dispute, they can take the dispute to the ________.

World Trade Organization

A fixed amount of money that an employee receives--regardless of the number of hours worked or the worker's output--is called ________.

a lump-sum payment

A(n) ______ is when one company purchases or takes over a different company.

acquisition

A ________ contains a company's assets, liabilities, and owner's equity.

balance sheet

A ________ is a legal entity created and recognized by state law with assets and liabilities separate from those of its owners.

corporation

Which of the following is a liquidity ratio?

current ratio

Easy access to ports tends to ________ physical barriers to trade and ________ international trade overall.

reduce; increase

A(n) ________ specifies how much the employee will be compensated in exchange for a specified amount of work.

employment contract

The most committed, risky, and expensive way to access a foreign market is ________.

foreign direct investment

A company in one country purchases a company in another country. The company that has been purchased is known as a ________.

foreign subsidiary

A ________ is a monetary payment made up front to the owner of a trademark, a trade name, business operation, or a copyright for the right to use it.

franchise fee

A ________ has three essential elements: sharing of profits or losses, joint ownership of the business, and an equal right to be involved in the management of the business.

general partnership

In a cult-like organizational environment such as Google and Microsoft, the pay/commitment relationship is ________.

high pay and high commitment

Since 1960, the level of global trade as a share of GDP in most countries has ________.

increased significantly

On the Statement of Cash Flows, the sale or purchase of property is an example of ________ activities.

investing

High-performance work systems can be achieved when companies treat their employees as ________.

investments

A job applicant's knowledge, abilities, skills, and other characteristics are referred to as a ________.

job qualifications

Which of the following are examples of an employee's job qualifications?

knowledge, abilities, skills, and other characteristics

Which of the following is not one of the essential elements of a general partnership?

limited liability

A ________ maintains the rights to a share of the company's profits and joint ownership for those who are partners, but gives up the rights to management decisions of the business.

limited partnership

Which of the following is not a benefit of global trade?

lower income inequality

A(n) ________ is when two companies combine to create a new company.

merger

Accounts receivables are best described as ________.

money expected to be received in the near term

Structured interviews are ________ unstructured interviews.

more valid than

Characteristics of legally defensible performance appraisals include ________.

multiple trained raters

On the Statement of Cash Flows, the revenues received by a company are considered ________.

operating activities

To be considered a multinational corporation, a business must:

own a physical presence in a foreign country.

Strategies that capitalize on ________ can result in high-performance work systems.

people

All earnings of a partnership are taxed as ________.

personal income

When a manager decides to pay employees a certain amount of money for each item produced, the manager is using the ________ type of payment.

piece-rate

Unlimited liability means that the owner of a sole proprietorship

potentially could lose both personal and business assets.