Chapter 6- Types of Business Ownership
The Franchisee Payments portion of a franchise agreement typically covers which of the following?
Renewal and transfer fees
Assuming you were the CEO of a company with 72 shareholders, offering only common stock. This company would likely fall under which of the four categories of corporations?
S corporation
To be eligible for S corporation status, a corporation must have no more than
100 shareholders.
In the U.S economy, employment generated by franchised businesses grew by what percentage between 2001 and 2005?
12.6%
Which of the following statements about business divisions is NOT true?
A corporation is not responsible for all its divisions
Which of the following is NOT true of a sole proprietorship?
A sole proprietor may only use his or her legal name for the business.
Why do companies often describe acquisitions as a "merger of equals"?
Acquisitions and takeovers often carry negative connotations
Under what circumstance can corporations legally evade double taxation?
All of these answers
When considering a merger and acquisition, businesses must consider which of the following factors?
All of these answers
Which of the following is an example of a syndicate?
All of these answers
Which of the following is NOT true about cooperatives?
Co-ops only exist in agriculture
The amount of franchise or capital values tax limited liability companies must pay is based on
Company revenues.
Which of the following is NOT true regarding the legal aspects of nonprofit organizations?
Non-for-profit organizations are not required to have board members or steering committee members
Which of the following makes it difficult for franchisers to control the activities of franchisees?
Franchisees and franchisers are often separated by geography
A private or public corporate entity in which an existing government owns a stake through a holding company is referred to as a
Government-linked company.
Who usually controls the day-today activities of a corporation?
Individuals appointed by members
A corporation can be forced to shut down by the government if:
It breaks the law
Businesses that experience organic growth do so due to which of the following reasons?
New sales
In a sole proprietorship, there is no legal distinction between:
The owner and the business.
Navigating government regulations is one of the primary advantages of owning a sole proprietorship since
sole proprietorships do not have to pay corporate taxes.
