Exam 2 Review

Retained earnings

a source of long-term funds for a firm

Variable costs

costs that change as output changes

A similarity between a sole proprietorship and a partnership?

both their earnings are untouched by the Internal Revenue Service.

what is an advantage of a C corporation?

shareholders have limited liability in the firm

Lester owns a small law firm and has a 10 hour workday. Despite keeping long hours, he is open to working on weekends and holidays if required. He also responds to late-night calls from clients. Which of the entrepreneurial characteristics is highlighted in the given scenario?

energy

The board of directors of a corporation

established the corporation's mission

Olivia runs a spa for women. She employs only two helpers and one receptionist. This enables her to focus most of her resources on procuring products requires to provide comfort and high-quality services to customers. The opportunity of _____ is highlighted in the given scenario.

having lower overhead costs

The equity in a firm's capital structure...

imposes no required payments

What info is found in the U.S. Small Business Administration (SBA)

industry-specific statistics

Net income

is the profit or loss a firm earns in the time period covered by the financial statement that reports the revenues and expenses.

In the context of creating and delivering successful verbal presentations, which is true of dynamic delivery?

it begins and ends with preparation

Socially responsible firm

it has an obligation to respect the needs of all stakeholders

Since sole proprietorships are extensions of their owners, they...

lack permanence

Alpha Inc. saw an increase in profits in the previous year following which the management decided to reinvest its earnings. These retained earnings will be used to...

meet the company's long-term financial needs

The management of sugar manufacturing company sets aside the sum of $50,000 in its budget for the purchase of new machinery that would double the production. the management is in the process of planning the ____ of the company

operating budget

uncomfortable chairs in a conference can create____ to communication

physical barrier

Carve-Out

remove from a larger whole

According the the U.S. Small Business Administration, to officially count as "small," _____

the average revenue of a business should range from $0.75 million to $28.5 million

What is the difference between a C corporation and an S corporation?

the members of a C corporation have limited liability, whereas the members of an S corporation have unlimited liability.

In the context of small business opportunities, which is true of market niches?

they tend to be quite attractive to small firms