Which of the Following Is True About Small Businesses

question 37

Multiple Choice

Which of the following is true about small businesses?

• A) The manager usually owns the business.
• B) The area of operations is not necessarily local, although the market is primarily local.
• C) Capital is supplied and ownership is held by a large number of individuals.
• D) In the European Union (EU), more than 70 percent of the workforce is employed in firms with 10 or fewer employees.

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Definitions:

Cash Operating Expenses

Expenses that a company pays out in cash during an operational period, including salaries, utilities, and rent, but excluding non-cash expenses like depreciation.

Annual Depreciation

The allocation of an asset's cost over its useful life, representing how much of an asset's value has been used up during a fiscal year.

Simple Rate Of Return

A straightforward method of calculating the return on investment by dividing annual incremental net operating income by the initial investment cost.

Cash Operating Costs

Direct costs associated with the day-to-day operations of a business, paid out in cash, including labor, materials, and overhead.