Quiz 4
Articles of Incorporation do not include: -the classes of stock -the minimum capital requirements -the objective of the coporation -the name and address of the corporation -a list of all stockholders' names
a list of all stockholders' names
Ottens Flavors, Philadelphia, announced its combination with MK Flavors,& Co., Mexico City. The Mexican operation will offer the U. S.-based company an increased market presence in Central and South America. The new company will be renamed MK Ottens Flavors. MK Ottens Flavor was created through a(n): -acquisition -voluntary union -conglomerate -merger -joint venture
acquisition
The purchase of one company by another with no new company being formed is called a( n ) _____. -acquisition -merger -hostile takeover -investment
acquisition
Jayson Tully is contemplating the purchase of a Popeye's Chicken franchise. Tully has made a list of the disadvantages that he assumes he will face as a new business owner. Which of the following is actually an advantage? -conformity to operating procedures -royalty fees -assistance in building plans -up-front franchise fee -defined territory
assistance in building plans
A______________________merger brings together companies in unrelated businesses to reduce risk. -conglomerate -combination -horizontal -vertical -cooperative
conglomerate
In deciding on a legal form of organization, you should ask yourself all of the following questions except______________ -do you want to share the profits with others -do you have all the skills needed to run the business -how many employees will you hire -what are your financing needs
how many employees will you hire
A very important consideration in picking a legal form of business is: -how long you plan to run the business -how much legal liability you are willing to accept -how successful you believe your business will be -how many competitors you expect to have
how much legal liability you are willing to accept
Which of these statements is true in regard to the sole proprietorship form of business? -you are required to share profits with others -if you die, the business continues -if the company borrows money from a bank, you are not personally liable for the debt -it makes financing more difficult
it makes financing more difficult
Hard Rock Cafe International and Sol Melia Hotels and resorts have allied to develop a multimillion-dollar hotel. This relationship is a _____________________-because their alliance will end as soon as the hotel is completed. -general partnership -C corporation -cooperative -limited-time partnership -joint venture
joint venture
___________________________are corporate takeovers financed by large amounts of borrowed money -leveraged buyouts -amortized mergers -financed mergers -liquidity corporations -debt acquisitions
leveraged buyouts
in a( n ) _____ partnership, a single partner runs the business and any number of other partners have little involvement in it: -general -limited -unlimited -corporation
limited
the most important benefit of incorporation is the _____ feature of corporations -limited continuity -limited liability -financial resources -unlimited liability
limited liability
which of the following is not an advantage of a partnership (relative to a sole proprietorship)?: -inexpensive to set up -makes financing easier -benefits from diverse management talents -limited liability
limited liability
What advantage(s) does the S-corporation give to the small business owner that the regular corporation does not give to the small business owner? -limited liability protection -more favorable tax treatment -complete control over the business -the small business owner can keep all of the profits
limited liability protection
the _____ in a limited partnership has(have) limited involvement in the business and suffer loss only to the extent of their business investments: -limited partners -general partner -senior partner -managing partner
limited partners
The combination of two companies that join to form one company is called a: -conglomerate -voluntary union -merger -joint venture -cartel
merger
a( n ) _____ occurs when two companies join together and form a new company: -acquisition -merger -hostile takeover -joint venture
merger
As attorneys who share equal ownership, profits, and losses in their firm, Raymond James and Alexander Doss have opted for which legal form of business ownership? -partnership -sole proprietorship -limited liability corporation -s corporation
partnership
A disadvantage of franchising to the franchisee is: -national name recognition -ongoing management training program -standardized operating procedures -restricted operating freedom -assistance in site location
restricted operating freedom
Which of the following is not a requirement of an S-corporation? -maximum of 100 stockholders -each stockholder must be a U.S. citizen or resident -revenues must be at least than $1 million annually -all stockholders must concur with the decision to form the S-corporation
revenues must be less than $1 million annually
As a limited liability company (LLC), Miller Shipping would closely resemble a( n ) _____. -s-corporation -partnership -cooperative -sole proprietorship
s-corporation
which of the following statements is not true about sole proprietors: -they are willing to risk their own resources to start a business -they need a lot of money from others to start a business -they want to minimize the costs of getting started -they risk their personal assets for the business
they need a lot of money from others to start their business
Which of the following is a disadvantage associated with a partnership? -flexibility -diversity of management -unlimited liability -possibility of more available credit -ease of information
unlimited liability
which of the following is not true for a sole proprietor -you have to complete control over your business -you get all the income earned by the business -you have limited liability -any profits earned are taxed as personal income
you have limited liability
Which of the following statements about cooperatives is true? -cooperatives cannon legally compete with taxable entitles -cooperatives have the same liabilities as partnerships -cooperatives have a limited life span -cooperatives increase their members buying power
cooperatives increase their members buying power
A corporation pays taxes on its earnings. When the earnings are distributed as dividends, the shareholders pay taxes on these dividends. This is called _____. -corporate and personal taxation -double taxation -excessive taxation -tax burden
corporate and personal taxation
A _____ is entirely separate from the parties who own it. -corporation -limited partnership -general partnership -unlimited partnership
corporation
When it distributes a portion of its income to shareholders in the form of cash payments, a corporation pays out _____. -dividends -shares -allotments -capital surpluses
dividends
in a limited partnership, a single _____ runs the business and is responsible for all of the business liabilities -senior partner -CEO -general partner -limited partner
general partner
Under the ____ form of ownership, it's important to have an agreement about conditions for settling disputes. -general partnership -limited partnership -corporation -sole proprietorship
general partnership