Chapter 10 - Finance

Owners equity refers to the value of the owners money in the business.

• True

• False

Assets = Owners Equity - Liabilities

• True

• False

A salary is a fixed cost.

• True

• False

Cost per unit is calculated by dividing the total costs by the number of units produced.

• True

• False

The steps in the feasibility study include: 1 – Describe the business, 2 – Describe the market, 3 – Is it viable?

• True

• False

Liability insurance covers the business against dishonest employees.

• True

• False

Insurance is a means for the business to transfer their risk.

• True

• False

Premium is a monthly contribution made to the insurance company to ensure cover.

• True

• False

Variable costs differ according to the units produced.

• True

• False

Bad debt is something that one can easily insure.

• True

• False