Question 1

Discuss the advantages and disadvantages of leasing.

Accepted Answer

The benefits of leasing are the following: First,you can usually obtain a very low down payment.Second,the process of negotiating and closing a lease is usually less complicated and expensive than making a purchase and obtaining borrowed funds.A third benefit is that it is usually much easier for you to replace leased assets than it is to replace assets you own.
The primary disadvantage of leasing is that it usually costs more than would purchasing.A secondary disadvantage is that leased assets are usually subject to numerous restrictions on how they may be used,maintained,and disposed of.Restrictive lease covenants are intended to provide protection to the owner by preventing the lessee from allowing the asset to lose value through misuse,neglect,or abuse.

Question 2

The amount of time it takes a business to earn back the funds it paid out to obtain a capital asset is called:

Accepted Answer

A) return on sales. 
B) net profit margin. 
C) ROI. 
D) payback period. 
A) return on sales. 
B) net profit margin. 
C) ROI. 
D) payback period. D

Question 3

Cost of owning an asset includes cost incurred in financing,insuring,taxing,or tracking an asset.

Accepted Answer

A) True 
 B)False  True

Question 4

Under this type of arrangement,a small business may buy only that share that it can reasonably use during the course of business.

Accepted Answer

A) Partnership 
B) Fractional ownership 
C) Joint Ventures 
D) Limited company 
A) Partnership 
B) Fractional ownership 
C) Joint Ventures 
D) Limited company

Question 5

The purchase of inventory,very typical with Internet firms,only after a sale is made is called:

Accepted Answer

A) microinventory. 
B) periodic inventory. 
C) perpetual inventory. 
D) point-of-sale system. 
A) microinventory. 
B) periodic inventory. 
C) perpetual inventory. 
D) point-of-sale system.

Question 6

What is the difference between the gross amount of the receivables and the amount that is ultimately collected?

Accepted Answer

A) Factor's profit margin 
B) Lock box 
C) Profit maximization 
D) Commission 
A) Factor's profit margin 
B) Lock box 
C) Profit maximization 
D) Commission

Question 7

The price at which goods and services are bought and sold between willing sellers and buyers in an arm's-length transaction is called:

Accepted Answer

A) book value. 
B) disposal value. 
C) fair market value. 
D) replacement value. 
A) book value. 
B) disposal value. 
C) fair market value. 
D) replacement value.

Question 8

Renting capital assets provides all of these advantages EXCEPT:

Accepted Answer

A) it requires little or no cash investment. 
B) it does not require extensive paperwork. 
C) it protects you from unexpected repairs. 
D) it usually results in higher sales revenues due to repeat business. 
A) it requires little or no cash investment. 
B) it does not require extensive paperwork. 
C) it protects you from unexpected repairs. 
D) it usually results in higher sales revenues due to repeat business.

Question 9

A lease in which at the end of the lease period the asset becomes the property of the lessee,possibly with an additional payment is called a(n):

Accepted Answer

A) operating lease. 
B) short-term lease. 
C) reverse lease. 
D) capital lease. 
A) operating lease. 
B) short-term lease. 
C) reverse lease. 
D) capital lease.

Question 10

The two most commonly used financial ratios for comparing investment alternatives are:

Accepted Answer

A) current and quick ratios. 
B) return on sales and return on investment. 
C) operating profit margin and net profit margin. 
D) payback period and ROI. 
A) current and quick ratios. 
B) return on sales and return on investment. 
C) operating profit margin and net profit margin. 
D) payback period and ROI.

Question 11

Discuss the major types of leases.

Accepted Answer

There are two basic types of leases,oper

Question 12

Discuss inputs,outputs,and feedback.

Accepted Answer

Inputs are the materials,labor,and energ

Question 13

The practice of acquiring inventory only in response to a completed sale is called a(n):

Accepted Answer

A) economic order quantity. 
B) pull-through system. 
C) periodic inventory. 
D) perpetual inventory. 
A) economic order quantity. 
B) pull-through system. 
C) periodic inventory. 
D) perpetual inventory.

Question 14

Which of the following is not generally considered to be very useful for any purpose other than accounting and income taxes?

Accepted Answer

A) Replacement value 
B) Salvage value 
C) Book value 
D) Disposal value 
A) Replacement value 
B) Salvage value 
C) Book value 
D) Disposal value

Question 15

The primary advantage of ROI is that it focuses on the time value of money.

Accepted Answer

A) True 
 B)False

Question 16

_____ is the fixed and determinable value of an asset that will exist when the depreciation process is complete.

Accepted Answer

A) Useful life 
B) Salvage value 
C) Book value 
D) Disposal value 
A) Useful life 
B) Salvage value 
C) Book value 
D) Disposal value

Question 17

Giving a third party legal rights to debts owed your business in order to provide assurance that borrowed money will be repaid refers to:

Accepted Answer

A) pledging receivable. 
B) factoring. 
C) EOQ. 
D) JIT inventory. 
A) pledging receivable. 
B) factoring. 
C) EOQ. 
D) JIT inventory.

Question 18

Capital assets are otherwise known as:

Accepted Answer

A) operating assets. 
B) inventory. 
C) intangible assets. 
D) current assets. 
A) operating assets. 
B) inventory. 
C) intangible assets. 
D) current assets.

Question 19

The primary advantage of replacement value is:

Accepted Answer

A) accuracy. 
B) high cost. 
C) low taxes. 
D) low cost. 
A) accuracy. 
B) high cost. 
C) low taxes. 
D) low cost.

Question 20

Cost incurred in the activities necessary to get rid of an asset is called:

Accepted Answer

A) whole of life costs. 
B) cost of disposition. 
C) cost of owning. 
D) cost of operation. 
A) whole of life costs. 
B) cost of disposition. 
C) cost of owning. 
D) cost of operation.

Discuss the advantages and disadvantages of leasing.

The amount of time it takes a business to earn back the funds it paid out to obtain a capital asset is called:

Cost of owning an asset includes cost incurred in financing,insuring,taxing,or tracking an asset.

Under this type of arrangement,a small business may buy only that share that it can reasonably use during the course of business.

The purchase of inventory,very typical with Internet firms,only after a sale is made is called:

What is the difference between the gross amount of the receivables and the amount that is ultimately collected?

The price at which goods and services are bought and sold between willing sellers and buyers in an arm's-length transaction is called:

Renting capital assets provides all of these advantages EXCEPT:

A lease in which at the end of the lease period the asset becomes the property of the lessee,possibly with an additional payment is called a(n):

The two most commonly used financial ratios for comparing investment alternatives are:

Discuss the major types of leases.

Discuss inputs,outputs,and feedback.

The practice of acquiring inventory only in response to a completed sale is called a(n):

Which of the following is not generally considered to be very useful for any purpose other than accounting and income taxes?

The primary advantage of ROI is that it focuses on the time value of money.

_____ is the fixed and determinable value of an asset that will exist when the depreciation process is complete.

Giving a third party legal rights to debts owed your business in order to provide assurance that borrowed money will be repaid refers to:

Capital assets are otherwise known as:

The primary advantage of replacement value is:

Cost incurred in the activities necessary to get rid of an asset is called:

Small Business: Its Opportunities and Rewards

Small Business Environment: Managing External Relations

Small Business Entrepreneurs: Characteristics and Competencies

Small Business Ideas: Creativity, opportunity, and Feasibility

Small Business Entry: Paths to Part-Time Entrepreneurship

Small Business Entry: Paths to Full-Time Entrepreneurship

Small Business Strategies: Imitation With a Twist

Business Plans: Seeing Audiences and Your Business Clearly

Small Business Marketing: Product and Pricing Strategies

Small Business Promotion: Capturing the Eyes of Your Market

Small Business Distribution and Location

Marketing Plans: Saying How Youll Get Sales

Small Business Accounting: Projecting and Evaluating Performance

Cash: Lifeblood of the Business

Small Business Finance: Using Equity,debt,and Gifts

Small Business Protection: Risk Management and Insurance

Legal Issues: Recognizing Your Small Business Needs

Human Resource Management: Small Business Considerations

Achieving Success in the Small Business

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Exam 16: Assets: Inventory and Operations Management

Discuss the advantages and disadvantages of leasing.

The amount of time it takes a business to earn back the funds it paid out to obtain a capital asset is called:

Cost of owning an asset includes cost incurred in financing,insuring,taxing,or tracking an asset.

Under this type of arrangement,a small business may buy only that share that it can reasonably use during the course of business.

The purchase of inventory,very typical with Internet firms,only after a sale is made is called:

What is the difference between the gross amount of the receivables and the amount that is ultimately collected?

The price at which goods and services are bought and sold between willing sellers and buyers in an arm's-length transaction is called:

Renting capital assets provides all of these advantages EXCEPT:

A lease in which at the end of the lease period the asset becomes the property of the lessee,possibly with an additional payment is called a(n):

The two most commonly used financial ratios for comparing investment alternatives are:

Discuss the major types of leases.

Discuss inputs,outputs,and feedback.

The practice of acquiring inventory only in response to a completed sale is called a(n):

Which of the following is not generally considered to be very useful for any purpose other than accounting and income taxes?

The primary advantage of ROI is that it focuses on the time value of money.

_____ is the fixed and determinable value of an asset that will exist when the depreciation process is complete.

Giving a third party legal rights to debts owed your business in order to provide assurance that borrowed money will be repaid refers to:

Capital assets are otherwise known as:

The primary advantage of replacement value is:

Cost incurred in the activities necessary to get rid of an asset is called:

Small Business: Its Opportunities and Rewards

Small Business Environment: Managing External Relations

Small Business Entrepreneurs: Characteristics and Competencies

Small Business Ideas: Creativity, opportunity, and Feasibility

Small Business Entry: Paths to Part-Time Entrepreneurship

Small Business Entry: Paths to Full-Time Entrepreneurship

Small Business Strategies: Imitation With a Twist

Business Plans: Seeing Audiences and Your Business Clearly

Small Business Marketing: Product and Pricing Strategies

Small Business Promotion: Capturing the Eyes of Your Market

Small Business Distribution and Location

Marketing Plans: Saying How Youll Get Sales

Small Business Accounting: Projecting and Evaluating Performance

Cash: Lifeblood of the Business

Small Business Finance: Using Equity,debt,and Gifts

Small Business Protection: Risk Management and Insurance

Legal Issues: Recognizing Your Small Business Needs

Human Resource Management: Small Business Considerations

Achieving Success in the Small Business

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