Question 1

The merger of McKesson, a leading drug wholesaler, and HBOC, a producer of health-care inventory software, is an example of which of the following type of merger?

Accepted Answer

A)  vertical merger 
B)  horizontal merger 
C)  functional merger 
D)  acquired merger 
A)  vertical merger 
B)  horizontal merger 
C)  functional merger 
D)  acquired merger

Question 2

Which type of business organization experiences the least governmental regulation?

Accepted Answer

A)  limited partnership 
B)  public corporation 
C)  private corporation 
D)  sole proprietorship 
A)  limited partnership 
B)  public corporation 
C)  private corporation 
D)  sole proprietorship

Question 3

What is the purchaser of a franchise called?

Accepted Answer

A)  franchisee 
B)  franchisor 
C)  sole proprietor 
D)  contractor 
A)  franchisee 
B)  franchisor 
C)  sole proprietor 
D)  contractor

Question 4

Tiffany Worth is buying a Dairy Queen franchise. Which of the following is NOT normally expected of the franchisor?

Accepted Answer

A)  assistance in personal income tax preparation 
B)  set operating procedures 
C)  a proven track record 
D)  standard goods and services 
A)  assistance in personal income tax preparation 
B)  set operating procedures 
C)  a proven track record 
D)  standard goods and services

Question 5

Ralston Smythe owns Heritage Inn with four other people. All of the owners have limited financial risk. Smythe's inn is which of the following business structures?

Accepted Answer

A)  a general partnership 
B)  a corporation 
C)  a cooperative 
D)  a limited partnership 
A)  a general partnership 
B)  a corporation 
C)  a cooperative 
D)  a limited partnership

Question 6

Leveraged buyouts (LBO) are inefficient and do not generate enough cash to service the debt that was created by the merger.

Accepted Answer

A) True 
 B)False

Question 7

Sanford Lee is planning to open a pizza parlour. He has a secret tomato sauce recipe that he does not want to divulge to anyone. Lee also wants to have sole responsibility for all business decisions. What sort of organization should Lee form?

Accepted Answer

A)  limited cooperative 
B)  joint venture 
C)  sole proprietorship 
D)  limited partnership 
A)  limited cooperative 
B)  joint venture 
C)  sole proprietorship 
D)  limited partnership

Question 8

Which of the following is an area of boomer-driven franchise growth.

Accepted Answer

A)  travel 
B)  condominiums 
C)  eldercare 
D)  wheelchairs 
A)  travel 
B)  condominiums 
C)  eldercare 
D)  wheelchairs

Question 9

Ease of formation, flexibility, and diversity of management are advantages of which of the following forms of business ownership?

Accepted Answer

A)  cooperative 
B)  partnership 
C)  conglomerate 
D)  joint venture 
A)  cooperative 
B)  partnership 
C)  conglomerate 
D)  joint venture

Question 10

If Alonzo Bajalia were to become a limited partner in a landscaping company, which of the following would occur?

Accepted Answer

A)  He will agree not to participate in day-to-day management of the company. 
B)  He will be limited in the number of hours he can work each month. 
C)  He will limited in the amount he can invest. 
D)  He will qualify for a limited income tax rate. 
A)  He will agree not to participate in day-to-day management of the company. 
B)  He will be limited in the number of hours he can work each month. 
C)  He will limited in the amount he can invest. 
D)  He will qualify for a limited income tax rate.

Question 11

Distinguish between a merger and an acquisition.

Accepted Answer

A merger is a combination of two or more

Question 12

Sole proprietorships experience which of the following tax situations?

Accepted Answer

A)  They are double taxed. 
B)  They are neither a legal nor a taxable entity. 
C)  They are exempt from taxation. 
D)  They are usually taxed higher than individuals. 
A)  They are double taxed. 
B)  They are neither a legal nor a taxable entity. 
C)  They are exempt from taxation. 
D)  They are usually taxed higher than individuals.

Question 13

What is double taxation?

Accepted Answer

Corporations must pay federal

Question 14

When Addison Wilcox buys an H&R Block franchise, he becomes a franchisee.

Accepted Answer

A) True 
 B)False

Question 15

An association of two or more individuals who agree to operate a business together for a profit is referred to as which of the following?

Accepted Answer

A)  partnership 
B)  joint venture 
C)  association 
D)  strategic alliance 
A)  partnership 
B)  joint venture 
C)  association 
D)  strategic alliance

Question 16

Buying a franchise is not as important a growth strategy today as it was in the 1960s.

Accepted Answer

A) True 
 B)False

Question 17

One of the disadvantages of the sole proprietorship is that the owner has unlimited liability.

Accepted Answer

A) True 
 B)False

Question 18

What is double taxation in a corporation?

Accepted Answer

A)  Corporations must pay both provincial and federal taxes. 
B)  Corporations can double their earnings without higher taxes. 
C)  The corporation must pay taxes twice a year. 
D)  Earnings of the corporation and dividends of the shareholders are both taxed. 
A)  Corporations must pay both provincial and federal taxes. 
B)  Corporations can double their earnings without higher taxes. 
C)  The corporation must pay taxes twice a year. 
D)  Earnings of the corporation and dividends of the shareholders are both taxed.

Question 19

Tara Brtek owns and operates the Singing Pig Food Company. Brtek makes and markets 20 different gourmet mustards, salsas, marinades, and dip mixes using her crooning pig logo. Brtek has been thinking about changing her sole proprietorship to a corporation so she can take advantage of which of the following?

Accepted Answer

A)  an enhanced ability to attract financing 
B)  fewer government restrictions and regulations 
C)  lower and fewer taxes 
D)  guaranteed loans for expansion 
A)  an enhanced ability to attract financing 
B)  fewer government restrictions and regulations 
C)  lower and fewer taxes 
D)  guaranteed loans for expansion

Question 20

The sole proprietorship is considered a legal entity; therefore, it is taxed separately from the owner.

Accepted Answer

A) True 
 B)False

The merger of McKesson, a leading drug wholesaler, and HBOC, a producer of health-care inventory software, is an example of which of the following type of merger?

Which type of business organization experiences the least governmental regulation?

What is the purchaser of a franchise called?

Tiffany Worth is buying a Dairy Queen franchise. Which of the following is NOT normally expected of the franchisor?

Ralston Smythe owns Heritage Inn with four other people. All of the owners have limited financial risk. Smythe's inn is which of the following business structures?

Leveraged buyouts (LBO) are inefficient and do not generate enough cash to service the debt that was created by the merger.

Sanford Lee is planning to open a pizza parlour. He has a secret tomato sauce recipe that he does not want to divulge to anyone. Lee also wants to have sole responsibility for all business decisions. What sort of organization should Lee form?

Which of the following is an area of boomer-driven franchise growth.

Ease of formation, flexibility, and diversity of management are advantages of which of the following forms of business ownership?

If Alonzo Bajalia were to become a limited partner in a landscaping company, which of the following would occur?

Distinguish between a merger and an acquisition.

Sole proprietorships experience which of the following tax situations?

What is double taxation?

When Addison Wilcox buys an H&R Block franchise, he becomes a franchisee.

An association of two or more individuals who agree to operate a business together for a profit is referred to as which of the following?

Buying a franchise is not as important a growth strategy today as it was in the 1960s.

One of the disadvantages of the sole proprietorship is that the owner has unlimited liability.

What is double taxation in a corporation?

The sole proprietorship is considered a legal entity; therefore, it is taxed separately from the owner.

Political Environment

Economic Environment

Social Environment

Technological Environment

International Environment

Entrepreneurship and Small Business

Understanding the Business

Management and Leadership in Today’s Organizations

Designing Organizational Structures

Motivating Employees

Managing Human Resources and Labour Relations

Marketing

Creating Marketing Strategies

Achieving World-class Operations Management

Accounting for Financial Success

Understanding Money and the Canadian Financial System

Finance

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Exam 8: Forms of Business Ownership

The merger of McKesson, a leading drug wholesaler, and HBOC, a producer of health-care inventory software, is an example of which of the following type of merger?

Which type of business organization experiences the least governmental regulation?

What is the purchaser of a franchise called?

Tiffany Worth is buying a Dairy Queen franchise. Which of the following is NOT normally expected of the franchisor?

Ralston Smythe owns Heritage Inn with four other people. All of the owners have limited financial risk. Smythe's inn is which of the following business structures?

Leveraged buyouts (LBO) are inefficient and do not generate enough cash to service the debt that was created by the merger.

Sanford Lee is planning to open a pizza parlour. He has a secret tomato sauce recipe that he does not want to divulge to anyone. Lee also wants to have sole responsibility for all business decisions. What sort of organization should Lee form?

Which of the following is an area of boomer-driven franchise growth.

Ease of formation, flexibility, and diversity of management are advantages of which of the following forms of business ownership?

If Alonzo Bajalia were to become a limited partner in a landscaping company, which of the following would occur?

Distinguish between a merger and an acquisition.

Sole proprietorships experience which of the following tax situations?

What is double taxation?

When Addison Wilcox buys an H&R Block franchise, he becomes a franchisee.

An association of two or more individuals who agree to operate a business together for a profit is referred to as which of the following?

Buying a franchise is not as important a growth strategy today as it was in the 1960s.

One of the disadvantages of the sole proprietorship is that the owner has unlimited liability.

What is double taxation in a corporation?

The sole proprietorship is considered a legal entity; therefore, it is taxed separately from the owner.

Political Environment

Economic Environment

Social Environment

Technological Environment

International Environment

Entrepreneurship and Small Business

Understanding the Business

Management and Leadership in Today’s Organizations

Designing Organizational Structures

Motivating Employees

Managing Human Resources and Labour Relations

Marketing

Creating Marketing Strategies

Achieving World-class Operations Management

Accounting for Financial Success

Understanding Money and the Canadian Financial System

Finance

Filters