Selma Owns a Roofing Business

question 305

Multiple Choice

Selma owns a roofing business.She enjoys being her own boss,but her satisfaction comes at a price.Her days are filled with organizing the activities of her employees and soliciting new customers.She often misses activities with friends and family because of the obligations of running her own business.She also knows that she has unlimited personal liability for any of her firm's debts.Selma's business is organized as an) :

• A)Joint venture.
• B)C corporation.
• C)S corporation.
• D)Sole proprietorship.

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Definitions:

Minimum Required Rate of Return

The lowest rate of return that a potential investment must offer to be considered acceptable, taking into account the investor's cost of capital and risk appetite.

Annual Turnover

The total sales or revenue a company generates in one year.

ROI Analysis

A financial metric used to evaluate the efficiency of an investment or compare the efficiency of several different investments, calculated by dividing the net profit from the investment by the initial cost of the investment.

Net Operating Income

The income generated from normal business operations, calculated as revenues minus operating expenses and excluding income from investments and taxes.