Multiple Choice
Identify the
choice that best completes the statement or answers the question.
|
|
|
1.
|
The first part of a business plan is
a. | a customer analysis. | c. | a description of the competition. | b. | financial
plans. | d. | a description of the
business. |
|
|
|
2.
|
An employee who works every Thursday and Friday for three hours each day is
considered a
a. | permanent employee. | c. | full-time employee. | b. | temporary employee. | d. | part-time
employee. |
|
|
|
3.
|
A balance sheet lists
a. | assets and liabilities. | c. | liabilities and
budgets. | b. | financial plans and budgets. | d. | net incomes. |
|
|
|
4.
|
A type of incentive where employees receive their regular compensation plus a
share of the profits earned by a company is called
a. | profit sharing. | c. | straight salary. | b. | commission. | d. | base plus incentive
salary. |
|
|
|
5.
|
When expenses are greater than income, the result is
a. | net income. | c. | a net loss. | b. | gross income. | d. | none of the
above. |
|
|
|
6.
|
A temporary employee is
a. | one hired for a specific time or to complete a specific project. | b. | one who works less
than a full-time employee. | c. | one who works a schedule of 30 or more hours
per week. | d. | none of the above. |
|
|
|
7.
|
The budget that describes the financial plan for the day-to-day operations of
the business is called
a. | a start-up budget. | c. | a cash budget. | b. | an operating budget. | d. | a financial
plan. |
|
|
|
8.
|
What records contain information on all employees of the company and their
earnings?
a. | cash records | c. | employee records | b. | financial records | d. | payroll records |
|
|
|
9.
|
When compared to the past, today’s small-business owners are more likely
to be
a. | less educated. | c. | minorities. | b. | males. | d. | older. |
|
|
|
10.
|
When preparing a budget for the first time, many small businesses seek help
from
a. | a financial analyst. | c. | an established permanent employee. | b. | an established
corporation. | d. | an
accountant. |
|
|
|
11.
|
Short-term financing is obtained for a period of
a. | more than two years. | b. | one to two years. | c. | less than a year and
often for one or two months. | d. | less than a year and often more than five
months. |
|
|
|
12.
|
What statements do business owners review to determine how their businesses are
performing?
a. | liability statements | c. | cash statements | b. | financial statements | d. | profit
statements |
|
|
|
13.
|
Budgeting requires an understanding of financial information and
a. | technical writing skills. | c. | business management
skills. | b. | computer skills. | d. | a degree in English. |
|
|
|
14.
|
A budget that estimates income and expenses from the beginning of the business
until it becomes profitable is called a
a. | start-up budget. | c. | cost budget. | b. | financial plan. | d. | long-term
budget. |
|
|
|
15.
|
Compensation where an employee receives a specific amount of each unit of work
produced is called a
a. | wage. | c. | commission. | b. | straight salary. | d. | piece rate. |
|
|
|
16.
|
Short-term financing includes
a. | current operating activities. | c. | land. | b. | the cost of a
building. | d. | equipment. |
|
|
|
17.
|
The most important first step in starting a business is
a. | information. | c. | financing. | b. | preparation. | d. | an idea. |
|
|
|
18.
|
What is an incentive where an employee is paid a percentage of sales?
a. | commission | c. | straight salary | b. | wages | d. | piece rate |
|
|
|
19.
|
The first step in developing a business plan is to
a. | gather and review information. | c. | develop a “game
plan.” | b. | prepare. | d. | hire someone to write the plan. |
|
|
|
20.
|
Full-time employees often receive benefits such as
a. | health and life insurance plans. | c. | paid vacations. | b. | disability
insurance. | d. | all of the
above |
|
|
|
21.
|
Which statement is true about a proprietorship?
a. | One person will supply the money needed to start the business. | b. | Partners contribute
to the necessary financing of the business. | c. | The company is owned and operated by
shareholders. | d. | Two people control the money, and a board of directors helps with the
decision-making. |
|
|
|
22.
|
If you own your own small business, the money you receive is called
a. | profit. | c. | expenses. | b. | revenue. | d. | owner’s
equity. |
|
|
|
23.
|
Operating a business requires skill in
a. | management. | c. | marketing. | b. | finance. | d. | all of the
above. |
|
|
|
24.
|
Compensation is defined as
a. | commissions and base incentives. | b. | straight salary and
commissions. | c. | money paid to an employee for work performed. | d. | profit sharing and
piece rates. |
|
|
|
25.
|
An estimate of the actual money received and paid out for a specific time period
is called
a. | a marketing mix. | c. | a cash budget. | b. | a financial group. | d. | an operating
budget. |
|
|
|
26.
|
One to whom the company makes a long-term commitment is a
a. | temporary employee. | c. | permanent employee. | b. | part-time employee. | d. | full-time
employee. |
|
|
|
27.
|
The two parts to the study of work requirements in preparation for hiring new
employees are
a. | the past work of employees and future activities planned for a
business. | b. | the current work of a business and new activities planned for the
business. | c. | the past activities planned for a business and future work of
employees. | d. | none of the above. |
|