Mucho Tacos, Inc, sells franchises. Mucho Tacosimposes on its fran¬chi¬sees standards of operation and personnel training methods. What is the potential pitfall to Mucho Tacosif it exercises too much control over its fran¬chisees?
A provision in a franchise agreement permitting the franchisor to establish and enforce certain quality standards is valid and unquestionable. A franchisor has a legitimate interest in maintaining the quality of its products or services to protect its name and reputation.
But too much control over the operations of its franchisees risks potential liability. For example, under the doctrine of respondeat superior, the exercise of too much control may result in the franchisor's liability for the torts of a franchisee's employees. That is, if the franchisor has a right to control the franchisee's operations and exercises this right to a significant degree, and an employee under this control acts in a tortious or criminal manner that results in an injury to another, the franchisor may be held vicariously liable.
You might also like to view...
The Kruskal-Wallis one-way analysis of variance also examines the difference in medians
Indicate whether the statement is true or false
Global leadership can be regarded as different in kind from domestic leadership because
A. their differences are of such great degrees with regard to their level of skills and application. B. the domestic context does not require travel or knowledge of geography. C. the domestic context is so limited. D. it requires much more knowledge of foreign languages and geography. E. the differences between them are inconsequential.
Asking a colleague or employee to walk through the steps outlined in a procedural document is recommended prior to finalizing the document
Indicate whether the statement is true or false
Byrd Company experienced an accounting event that affected the elements of its financial statements as indicated below:Assets=Liab.+EquityRev.?Exp.=Net Inc.Cash Flow? NA ?NA + ?NA Which of the following accounting events could have caused these effects?
A. Amortized patent cost under the straight-line method. B. Recognized depletion expense under the units-of-production method. C. Recognized depreciation expense under the double-declining-balance method. D. All of these answer choices are correct.