Identify six factors affecting the choice of the most appropriate form of business enterprise. Name the nine forms of business associations discussed in the chapter
The choice of the most appropriate form of business enterprise cannot be determined in a general way, but depends on the particular circumstances of the owners.
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Factors to consider include: ease of formation, taxation issues, external liability, degree of management and control, transferability of the ownership interests, and continuity of the business upon the death, bankruptcy, or withdrawal of an owner.
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Forms of business associations include: sole proprietorship, general partnership, joint venture, limited partnership, limited liability company, limited liability partnership, limited liability limited partnership, corporation, and business trust.
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No contribution margin is provided by selling one unit of a product at a price of $35 if variable production costs are $20, variable general and administrative costs are $5, and fixed costs are $10 per unit.
Answer the following statement true (T) or false (F)
Relative bargaining power is closely related to:
A. The parties' resistance points. B. Management's strike leverage. C. The union's strike leverage. D. The parties' willingness to compromise.
Chojnowski Incorporated makes a single product-a cooling coil used in commercial refrigerators. The company has a standard cost system in which it applies overhead to this product based on the standard labor-hours allowed for the actual output of the period. Data concerning the most recent year appear below: Budgeted (Planned) Overhead: Budgeted variable manufacturing overhead$82,450 Budgeted fixed manufacturing overhead 325,975 Total budgeted manufacturing overhead$408,425 Budgeted production (a) 25,000unitsStandard hours per unit (b) 1.70labor-hoursBudgeted hours (a) × (b) 42,500labor-hours Applying Overhead: Actual production (a) 20,000unitsStandard hours per unit (b) 1.70labor-hoursStandard hours allowed for the actual production (a) ×
(b) 34,000labor-hours Actual Overhead and Hours: Actual variable manufacturing overhead$74,812 Actual fixed manufacturing overhead 312,975 Total actual manufacturing overhead$387,787 Actual hours 31,700labor-hoursThe predetermined overhead rate is closest to: A. $9.61 per labor-hour B. $16.34 per labor-hour C. $19.39 per labor-hour D. $11.41 per labor-hour
Gary owns two all-terrain vehicles (ATVs), worth $1,000 and $500, respectively. Helen enters into a contract to buy "Gary's ATV" for $750. Gary believes, in good faith, that he is selling the $500 ATV. Helen believes, in good faith, that she is buying the $1,000 ATV. In this situation
A. Gary is entitled to $750 for the $500 ATV. B. Helen is entitled to the $1,000 ATV for $750. C. Helen must buy both ATVs for $1,500. D. the contract is not enforceable.