A Business Run by the Individual Who Owns It Is

question 87

Multiple Choice

A business run by the individual who owns it is referred to as a(n) _____.

• A) franchise
• B) owner-managed firm
• C) professionally-owned business
• D) novelty firm

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Definitions:

Trade-in Allowance

The credit a buyer receives when they trade in an old asset (like a car) towards the purchase of a new asset, reducing the price of the new purchase.

Book Value

The net value of a company's assets as listed on the balance sheet, calculated by subtracting liabilities from total assets.

Commercial Substance

A concept indicating that a transaction significantly changes the economic position or cash flows of the parties involved, beyond mere contractual obligations.

Trade-in Allowance

The amount credited to the buyer by the seller for a traded item, reducing the cost of the new purchase.