Viola Wants to Be a Business Owner and Is Contemplating

question 87

Multiple Choice

Viola wants to be a business owner and is contemplating whether to start her own business or open a franchise.Which of the following,if true,would be a compelling reason for Viola to open a franchise rather than start a new business?

• A) The franchiser requires $3,000 in start-up costs and a 5 percent monthly royalty fee.
• B) The franchiser tightly controls and monitors the service protocol.
• C) The franchisee is responsible for developing all marketing materials.
• D) The company has only recently become a franchise.
• E) There are several other franchises with the same company in the area.

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Definitions:

Asset Account

An account that records the valuable resources owned by a business, expected to provide future economic benefits.

Goods Returned

Products sent back to the seller by the buyer, usually due to defects, inaccuracies, or dissatisfaction.

Inventory

The raw materials, work-in-process products, and finished goods considered to be the portion of a business's assets that are ready or will be ready for sale.

Current Asset

Assets expected to be converted into cash, sold, or consumed within one year or the normal operating cycle, whichever is longer.