ELE 3010 EXAM 3 QUESTIONS AND
CORRECT ANSWERS!!
The formula for break even is:
- Total variable costs divided by marginal contribution
- Total sales divided by selling price plus variable cost per unit
- Total fixed costs divided by selling price plus marginal contribution
- Total fixed costs divided by selling price minus variable cost per unit
Total fixed costs divided by selling price minus variable cost per unit
The management team of a new venture:
- Can expect to draw a large salary
- Must operate the business full-time
- Is encouraged to operate the business as a sideline
- Should be employed elsewhere to assure adequate income
Must operate the business full-time
The difference between a board of directors and a board of advisors is that:
- The board of advisors meets less frequently
- The board of directors lacks voting authority
- The board of directors is subject to less pressure of litigation
- The board of advisors are compensated
The board of advisors meets less frequently
The sales budget:
- Must be based on actual sales figures for the last month
- Must be prepared by the venture's accounting firm
- Should be prepared before developing the pro forma income statement
- Needs to be prepared only in case of a manufacturing firm
Should be prepared before developing the pro forma income statement
, Corporations distribute profits to their owners through:
- Taxes
- Bonds
- Dividends
- Interest
Dividends
Which type of ownership is the least expensive to start?
- Limited partner
- Corporation
- Sole proprietorship
- General partnership
Sole proprietorship
Which of the following is not one of the main functions of the management team according
to text?
- Make adjustments based on changes in the environment and market that will maintain
profitability
- Identify fundamental changes in the business plan as they occur
- Execute business plan
- Help the entrepreneur write the business plan
Help the entrepreneur write the business plan
Conducting a(n) _____ on cash flow involves assigning a "+" or "-" probability to the
estimated value.
- Audit
- Break-even analysis
- Distribution
- Sensitivity analysis
Sensitivity analysis
CORRECT ANSWERS!!
The formula for break even is:
- Total variable costs divided by marginal contribution
- Total sales divided by selling price plus variable cost per unit
- Total fixed costs divided by selling price plus marginal contribution
- Total fixed costs divided by selling price minus variable cost per unit
Total fixed costs divided by selling price minus variable cost per unit
The management team of a new venture:
- Can expect to draw a large salary
- Must operate the business full-time
- Is encouraged to operate the business as a sideline
- Should be employed elsewhere to assure adequate income
Must operate the business full-time
The difference between a board of directors and a board of advisors is that:
- The board of advisors meets less frequently
- The board of directors lacks voting authority
- The board of directors is subject to less pressure of litigation
- The board of advisors are compensated
The board of advisors meets less frequently
The sales budget:
- Must be based on actual sales figures for the last month
- Must be prepared by the venture's accounting firm
- Should be prepared before developing the pro forma income statement
- Needs to be prepared only in case of a manufacturing firm
Should be prepared before developing the pro forma income statement
, Corporations distribute profits to their owners through:
- Taxes
- Bonds
- Dividends
- Interest
Dividends
Which type of ownership is the least expensive to start?
- Limited partner
- Corporation
- Sole proprietorship
- General partnership
Sole proprietorship
Which of the following is not one of the main functions of the management team according
to text?
- Make adjustments based on changes in the environment and market that will maintain
profitability
- Identify fundamental changes in the business plan as they occur
- Execute business plan
- Help the entrepreneur write the business plan
Help the entrepreneur write the business plan
Conducting a(n) _____ on cash flow involves assigning a "+" or "-" probability to the
estimated value.
- Audit
- Break-even analysis
- Distribution
- Sensitivity analysis
Sensitivity analysis
