Question 1

Of the following forms of business organization, which have stockholders with limited liability?

Accepted Answer

A)  proprietorships 
B)  partnerships 
C)  corporations 
D)  limited partnerships 
A)  proprietorships 
B)  partnerships 
C)  corporations 
D)  limited partnerships

Question 2

The depreciation deduction shields income from taxes.

Accepted Answer

A) True 
 B)False

Question 3

A decrease in an asset account is a use of cash flows.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following accounts is not usually part of the owners' equity for a corporation?

Accepted Answer

A)  common stock 
B)  paid-in-capital 
C)  retained earnings 
D)  shares outstanding 
A)  common stock 
B)  paid-in-capital 
C)  retained earnings 
D)  shares outstanding

Question 5

Implicit agency costs:

Accepted Answer

A)  will not harm shareholders 
B)  have a direct expense associated with them 
C)  may include restrictive covenants 
D)  include cost of goods sold 
A)  will not harm shareholders 
B)  have a direct expense associated with them 
C)  may include restrictive covenants 
D)  include cost of goods sold

Question 6

The costs of producing or manufacturing the products sold to earn revenues are grouped under cost of sales (COS).

Accepted Answer

A) True 
 B)False

Question 7

Of the following forms of organization, which businesses generate the largest sales?

Accepted Answer

A)  proprietorships 
B)  partnerships 
C)  corporations 
D)  limited partnerships 
A)  proprietorships 
B)  partnerships 
C)  corporations 
D)  limited partnerships

Question 8

A limited liability company (LLC):

Accepted Answer

A)  must register with the SEC to sell securities to the public 
B)  is an ongoing entity, even if one of the owners leaves 
C)  has a limited number of shareholders 
D)  limits financial exposure of its owners 
A)  must register with the SEC to sell securities to the public 
B)  is an ongoing entity, even if one of the owners leaves 
C)  has a limited number of shareholders 
D)  limits financial exposure of its owners

Question 9

Past professional experience in their fields is a common characteristic of successful entrepreneurs.

Accepted Answer

A) True 
 B)False

Question 10

Limited liability companies (LLC) are limited to 35 or fewer owners.

Accepted Answer

A) True 
 B)False

Question 11

Restricted stock is shares of stock awarded to managers that cannot be redeemed unless the manager is currently working for the firm.

Accepted Answer

A) True 
 B)False

Question 12

Owners' equity does not include:

Accepted Answer

A)  par value of the common stock 
B)  retained earnings 
C)  capital paid in excess of par account 
D)  notes receivable 
A)  par value of the common stock 
B)  retained earnings 
C)  capital paid in excess of par account 
D)  notes receivable

Question 13

Which of the following business organizations do not limit the liability of some or all of their owners to the extent of their investment in the company?

Accepted Answer

A)  proprietorships and partnerships 
B)  corporations and proprietorships 
C)  limited partnerships and proprietorships 
D)  corporations and limited partnerships 
A)  proprietorships and partnerships 
B)  corporations and proprietorships 
C)  limited partnerships and proprietorships 
D)  corporations and limited partnerships

Question 14

Implicit agency costs do not have a direct expense associated with them, but they harm shareholders anyway.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following forms of organization has an unlimited life?

Accepted Answer

A)  proprietorship 
B)  LLC 
C)  subchapter S corporation 
D)  corporation and subchapter S corporation 
A)  proprietorship 
B)  LLC 
C)  subchapter S corporation 
D)  corporation and subchapter S corporation

Question 16

Of the following forms of organization, which businesses are the greatest in numbers?

Accepted Answer

A)  proprietorships 
B)  partnerships 
C)  corporations 
D)  limited partnerships 
A)  proprietorships 
B)  partnerships 
C)  corporations 
D)  limited partnerships

Question 17

The goal of the firm is the maximization of profits and market share.

Accepted Answer

A) True 
 B)False

Question 18

Under which one of the following business organizations do the owners have unlimited liability for all debts of the firm?

Accepted Answer

A)  partnership 
B)  limited partnership 
C)  corporation 
D)  subchapter S corporation 
A)  partnership 
B)  limited partnership 
C)  corporation 
D)  subchapter S corporation

Question 19

The Sarbanes-Oxley Act established this entity. .

Accepted Answer

A)  Auditing Commission 
B)  Public Company Accounting Oversight Board 
C)  FASB 
D)  SEC 
A)  Auditing Commission 
B)  Public Company Accounting Oversight Board 
C)  FASB 
D)  SEC

Question 20

All of the following accounts are considered to be fixed assets on the balance sheet except:

Accepted Answer

A)  buildings 
B)  equipment 
C)  depreciation 
D)  machinery 
A)  buildings 
B)  equipment 
C)  depreciation 
D)  machinery

Of the following forms of business organization, which have stockholders with limited liability?

The depreciation deduction shields income from taxes.

A decrease in an asset account is a use of cash flows.

Which of the following accounts is not usually part of the owners' equity for a corporation?

Implicit agency costs:

The costs of producing or manufacturing the products sold to earn revenues are grouped under cost of sales (COS).

Of the following forms of organization, which businesses generate the largest sales?

A limited liability company (LLC):

Past professional experience in their fields is a common characteristic of successful entrepreneurs.

Limited liability companies (LLC) are limited to 35 or fewer owners.

Restricted stock is shares of stock awarded to managers that cannot be redeemed unless the manager is currently working for the firm.

Owners' equity does not include:

Which of the following business organizations do not limit the liability of some or all of their owners to the extent of their investment in the company?

Implicit agency costs do not have a direct expense associated with them, but they harm shareholders anyway.

Which of the following forms of organization has an unlimited life?

Of the following forms of organization, which businesses are the greatest in numbers?

The goal of the firm is the maximization of profits and market share.

Under which one of the following business organizations do the owners have unlimited liability for all debts of the firm?

The Sarbanes-Oxley Act established this entity. .

All of the following accounts are considered to be fixed assets on the balance sheet except:

The Financial Environment

Money and the Monetary System

Banks and Other Financial Institutions

Federal Reserve System

Policy Makers and the Money Supply

International Finance and Trade

Savings and Investment Process

Interest Rates

Time Value of Money

Bonds and Stocks: Characteristics and Valuations

Securities and Markets

Financial Return and Risk Concepts

Financial Analysis and Long-Term Financial Planning

Managing Working Capital

Short-Term Business Financing

Capital Budgeting Analysis

Capital Structure and the Cost of Capital

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Exam 13: Business Organization and Financial Data

Of the following forms of business organization, which have stockholders with limited liability?

The depreciation deduction shields income from taxes.

A decrease in an asset account is a use of cash flows.

Which of the following accounts is not usually part of the owners' equity for a corporation?

Implicit agency costs:

The costs of producing or manufacturing the products sold to earn revenues are grouped under cost of sales (COS).

Of the following forms of organization, which businesses generate the largest sales?

A limited liability company (LLC):

Past professional experience in their fields is a common characteristic of successful entrepreneurs.

Limited liability companies (LLC) are limited to 35 or fewer owners.

Restricted stock is shares of stock awarded to managers that cannot be redeemed unless the manager is currently working for the firm.

Owners' equity does not include:

Which of the following business organizations do not limit the liability of some or all of their owners to the extent of their investment in the company?

Implicit agency costs do not have a direct expense associated with them, but they harm shareholders anyway.

Which of the following forms of organization has an unlimited life?

Of the following forms of organization, which businesses are the greatest in numbers?

The goal of the firm is the maximization of profits and market share.

Under which one of the following business organizations do the owners have unlimited liability for all debts of the firm?

The Sarbanes-Oxley Act established this entity. .

All of the following accounts are considered to be fixed assets on the balance sheet except:

The Financial Environment

Money and the Monetary System

Banks and Other Financial Institutions

Federal Reserve System

Policy Makers and the Money Supply

International Finance and Trade

Savings and Investment Process

Interest Rates

Time Value of Money

Bonds and Stocks: Characteristics and Valuations

Securities and Markets

Financial Return and Risk Concepts

Financial Analysis and Long-Term Financial Planning

Managing Working Capital

Short-Term Business Financing

Capital Budgeting Analysis

Capital Structure and the Cost of Capital

Filters