Franchisors May Send Reverse Royalties to Franchisees Who

question 60

Multiple Choice

Franchisors may send reverse royalties to franchisees who:

• A)Have not yet created their own web site.
• B)Feel their sales have been hurt by the franchisor's Internet sales.
• C)Are using e-commerce to expand their sales territory.
• D)Desire to streamline their communication with employees,customers,and vendors.

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Definitions:

Prepaid Items

Expenses paid in advance and recorded as assets until they are used or consumed.

Expense Accounts

Accounts used in accounting to track money spent or costs incurred in a company's operations to generate revenue, typically categorized by the nature of the expenses.

Liability Accounts

Accounts that represent amounts owed to others, including loans, accounts payable, and mortgages.

Depreciation

The process of allocating the cost of a tangible asset over its useful life, recognizing the consumption, wear and tear, or obsolescence of physical or fixed assets used in operations.