Business Situations That Are Appropriate to Consider When Looking for Growth

question 6

Multiple Choice

Business situations that are appropriate to consider when looking for growth through franchising include all but which one of the following?

• A)firms in market niches that have broad product appeal and known consumer acceptance as long as the trends support long-term market viability and growth.
• B)firms in stable and growing industries,where the industry itself is unburdened by significant regulation.
• C)firms that have complex internal systems to execute,that draw from a limited pool of qualified employees,or require significant amounts for training to assure franchisee competence in delivery of the system's products or services.
• D)firms whose operating margins allow for franchisee fees to be charged and still leave an adequate r.o.i.for both franchisor and franchisee.

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Definitions:

Tax Reporting

The process of preparing and submitting tax documents to relevant tax authorities, detailing income, deductions, and other tax-related information.

Financial Reporting

Refers to the process of producing statements that disclose an organization's financial status to management, investors, and the government.

Merchandise Inventory

Goods that a company buys to resell at a profit. It is a current asset on the balance sheet.

Transportation-In

Costs associated with bringing inventory items to a company's location, which are added to the cost of inventory.