The board of directors of a corporation is responsible for all of the following except
A) arranging for major bank loans.
B) authorizing contracts.
C) carrying out the daily operations of the business.
D) declaring dividends.
C
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Despite its weaknesses, markup pricing remains popular for which of the following reasons?
A) Sellers can determine demand much more easily than they can estimate costs. B) By tying the price to cost, the pricing task becomes more sophisticated. C) When all firms in the industry use markup pricing, price competition flourishes. D) Sellers take advantage of buyers when the latter's demand becomes acute. E) Many people feel that cost-plus pricing is fairer to both buyers and sellers.
Riva borrows $10,000 that she intends to use for purchasing supplies for her business. She temporarily deposits the funds in her personal checking account. Prior to the deposit, the checking account held $40,000 of personal funds. Riva books a vacation for $6,000 and writes a check to the travel agency from her personal account. Later in the month, the business supplies bill arrives and Riva writes a check for $10,000 from the personal account. With respect to the interest expense on the $10,000 loan,
A. 20 percent will be treated as trade or business expense. B. 60 percent will be treated as personal interest expense and 40 percent as trade or business expense. C. it will all be treated as trade or business expense. D. it will all be treated as personal expense.
Which statement best describes the use of pronouns for most business reports?
A) The phrase the writer is a good substitute for first-person pronouns. B) Using passive voice is a good alternative to using first-person pronouns. C) Because formal reports focus on the information instead of on the writer, third-person pronouns should be used. D) Second-person pronouns should be used to draw the reader into the report. E) Use the word he as a generic pronoun when referring to an unidentified person.
Which of the following is a key benefit of using the degree of leverage concept in financial analysis?
A. It allows decision makers a relatively clear assessment of the consequences of alternative actions. B. It establishes the optimal capital structure for the firm. C. It shows how a given change in leverage will affect sales. D. It identifies, with certainty, the future net income based upon sales projections about the future. E. None of the above statements is correct.