Which of the following statements is TRUE about franchising?
A) Franchisees enjoy guaranteed minimum annual revenues based on their territory.
B) Franchisors encourage franchisees to be independent and creative in running their operations.
C) Franchisees have relatively lower risk than other small business start-ups.
D) Franchisees don't need to pay royalty fees to their franchisors.
E) All franchises restrict the location and number of their franchise locations.
C
Explanation: C) A successful franchisor has determined, through trial and error, the best system of daily operations for the established business. New franchisees can therefore avoid many of the common start-up mistakes of new business owners. Because the franchise's success rests on a proven business model, franchisees are discouraged from making creative changes to operating methods. Franchisors do not guarantee minimum revenues to their franchisees, nor do they necessarily conduct any local market research on their behalf. Franchisees must pay a monthly royalty fee to the franchisor, which is typically 6—10 percent of gross revenues. Some franchises do not restrict the location or number of their franchise locations. In those instances, franchisees could experience serious competition not only from another company but also from other franchisees in the same franchise organization.
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A. $5,493.71 B. $5,782.85 C. $6,087.21 D. $6,407.59 E. $6,744.83
What is the normal year-end treatment of immaterial variances recognized in a cost accounting system utilizing standards?
a. Reclassified to deferred charges until all related production is sold b. Closed to cost of goods sold in the period in which they arose c. Allocated among cost of goods manufactured and ending work in process inventory d. Capitalized as a cost of ending finished goods inventory
The budgeted direct materials purchases is normally computed as the sum of (1 ) the materials for production and (2 ) the desired ending inventory
Indicate whether the statement is true or false
In grading eggs into small, medium, and large, the Nancy Farms packs the eggs that weigh more than 3.6 ounces in packages marked "large" and the eggs that weigh less than 2.4 ounces into packages marked "small"; the remainder are packed in packages marked "medium." If a day's packaging contained 10.2% large and 4.18% small eggs, determine the mean and the standard deviation for the eggs' weights. Assume that the distribution of the weights is normal.
What will be an ideal response?