Which of the Following Is True of a Franchising Relationship

question 88

Multiple Choice

Which of the following is true of a franchising relationship?

• A) A franchisor pays a percentage of the gross sales to a franchisee.
• B) Usually, a franchisee is a foreign national whom a franchisor supplies with goods.
• C) A franchisee sells or distributes goods using a trade name or trademark owned by a franchisor.
• D) Federal law allows franchisors to terminate franchise agreements without any cause in order to protect their patent rights.

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Definitions:

Income Tax Expense

The cost to a company for income taxes owed to federal, state, and local governments, recorded as a financial expense in accounting.

Federal Income Taxes

Taxes levied by the federal government on annual income earned by individuals, corporations, trusts, and other legal entities.

State Income Taxes

Taxes imposed by individual states on the income earned by individuals and entities within their jurisdiction.

Cash Payment

A transaction where a payment for goods or services is made using physical currency or through a bank transfer.