Why Should You Have One or Two Board Members Who

question 24

Multiple Choice

Why should you have one or two board members who can be considered independent?

• A)So they can act in the interest of the principal owner
• B)They are not susceptible to potential conflicts of interest
• C)They usually make the final decisions
• D)They have a long list of business and professional contacts
• E)They will answer the majority of the entrepreneur's questions

---

Definitions:

Perpetual Inventory System

A method of inventory management where updates are made continuously as transactions occur, providing real-time inventory levels.

Selling Price

The price at which goods or services are offered for sale to customers.

Cost

The value of the expenses incurred in the production or acquisition of a good or service, including materials, labor, and overheads.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, culminating in net income or loss.