Ch 6

The UFOC contains how many sections

23

Which of the following costs add to the cost of franchising

insurance, payroll, legal and professional fees

Have a seller retain a _____ interest in the business

minority

The _____ approach indicates the importance of people's awareness of their daily lives for developing new business ideas

new-new

Coming up with a unique good or service is a _____ approach, while adapting something that is currently on the market or extending the offering to an area where it is not presently available is a(n) _____ approach

new-new, new-old

"Piggybacking" one's way into business involves using a _____ approach

new-old

Starting a business by adapting something already on the market is called what approach

new-old

The person who sells the franchise is usually required to do all of the following except

pay a fee

Which of the following costs do not add to the cost of franchising

prepaid utility bills

When buying a business, competition must be investigated because

price competition may affect profits, new competition may reduce market share, competition may be spending more money on advertising than you

What is the largest source of new business ideas among men

prior job

What is the largest source of new business ideas among women

prior job

An advantage to buying an on-going business is

reduced concern over future operations, time and effort are reduced, it may be purchased at a bargain price

When one discusses upside gain and downside loss, one is talking about

risk versus reward

The inventory should be examined for which for which of the following

salability, does a physical count correspond with the book count?, is it up to date?

Evaluating franchise opportunities include finding out more about which of the following

the franchisor, the franchise, the franchisee

The "right questions" the prospective small business owner should ask about a franchise deal with

the franchisor, the franchise, the market

Business related reasons for selling may include all but which of the following

the owner may be in trouble with suppliers, changes in leasehold conditions, changes in zoning which affect the business

Which of the following is NOT a disadvantage of a major franchise

track record of the franchisor

An advantage associated with franchising is

training and guidance provided by the franchisor, brand-name appeal of the franchise, track record of the other franchisees as proof of success

An analysis of the competition should look for

unscrupulous practices

After all of your investigation into a franchise, the final decision should be up to

you

The franchisee's responsibilities include

a finacial investment, payment of a fee, engaging in a continuous business relationship

An agreement not to compete is also known as

a legal restraint of trade

When this asset is purchased, the buyer should be sure to deduct those so old that they are deemed uncollectible

accounts receivable

Competitor factors in a buying decision do not include

age of the competition's owners

Which of the following is a question which can be sidestepped when buying a business

all can be sidestepped

Business related reasons for selling do not include which of the following

changes in the product supply chain

The franchisor's responsibilities include providing

company name, symbols and logos, management and training

Which is not a start-up expense

depreciation

The person who gets the franchise is usually required to do all of the following except

design a logo for the unit

What is an often overlooked asset when acquiring a new business

firm's records

A _____ is a system of distibution that enables a supplier to arrange for a dealer to handle a specific product or service under certain mutually agreed upon conditions

franchise

The individual who buys the franchise is the

franchisee

The individual who arranges for a dealer to handle a specific product or service under certain mutually agreed upon conditions is known as the

franchisor

A franchise system can be used for handling

goods and services

The extra value a business can command in a sale is known as

goodwill

Which of the following is an intangible asset

goodwill

Which of the following are trends creating business opportunities

green products, alternative energy, health care

Reviewing personnel of the business about to be purchased is important in order to determine

whether employees with key skills will stay or leave, if employees are leaving will enough remain to operate the business, the cost of replacing an employee

When one designs a unique good or service, the individual is said to have used a(n) _____ approach to starting the business

new-new

When buying a small business you need to know all of the following items except

the owner's family stability and relationships

Who must negotiate the final deal

the potential buyer

A key question to ask when buying an on-going small business is which of the following

How many personnel are going to remain

Which is not a cost of franchising

Insurance, payroll, debt service

Which is not a key question to ask when buying a business

Is the building heated with gas or electric?

Which franchise is not included in the top ten franchises

Jimmy John's

Which of the following is NOT a key question a prospective buyer needs to ask in buying a business

What is the owner's personal net worth?

The advantages of franchising include

training and guidance, brand-name appeal, proven track record