ESB 46-60

A restaurant owner finds that 68% of customers never come back.

What is the most important thing the restaurant owner should do to have a higher percentage of repeat customers?

• Ensure sufficient inventory

• Keep customers informed of sales

• Listen to customers

• Replicate competitor's discounts

A mechanic generates $1,000 in revenue per repair, with a gross profit margin of 40%. The mechanic needs to earn $10,000 in gross margin per month to break even. Through experience, he finds that 20% of active prospects buy within 30 days.

How many prospects should the mechanic have in the active client listings at all times, at a minimum?

• 50

• 125

• 250

• 500

A chef has created a menu specializing in items that are available from only one supplier. The owner of the restaurant is concerned about the effectiveness of the supply chain associated with this menu.

What is the concern of the owner?

• Advertising the specialized menu

• Distance from supplier

• Market share for the restaurant

• Reliability of supply

A cabinetmaker has noticed that sales volumes for two different product lines have changed during the recession. The sales volume for the less expensive line of restored cabinets has increased by 20%, while the sales volume for the more expensive line of new cabinets has decreased by 30%. The restored cabinets sell for 30% less than the new cabinets, but the cost to purchase, transport, and refinish the restored cabints is 25% less than the cost of new cabinets.

What should the cabinetmaker do to improve business?

• Increase the production of all cabinets

• increase the production of restored cabinets

• Reduce the production of all cabinets

• Reduce the production of restored cabinets

Which business risk occurs when an owner prices products incorrectly?

• Risk of technology failure

• Risk of compliance failure

• Risk of financial failure

• Risk of tax liability

In the first week of January a landscaping company had a beginning cash balance of $25,000.

During this time, the company's inflow and outflow of cash include the following:

Sales-------------------------------------> $10,000

AR collected-------------------------------->$180,000

Asset sales---------------------------------->$30,000

Direct materials and labor---------->$(106,000)

Manufacturing overhead------------>$(29,000)

Selling and administration cost---->$(35,000)

Asset purchased ------------------------>$(20,000)

What will the company's beginning cash balance in week two of January?

• $40,000

• $25,000

• $55,000

• $30,000

An entrepreneur opened a business and has sufficient money to move to a new neighborhood.

Which requirement will eliminate a location from consideration?

• Zoning

• Notarization

• Certificate

• Licensing

What is a drawback of a public corporation?

• There is no way to limit personal legal liability

• Shares are unable to be sold

• Greater financial reporting obligation

• Profits are taxed personally

A new landscaping business wants to identify customer segments to target for its services.

Select the correct segmentation for Behavioral

• Homeowner who are highly price sensitive and open to promotional discounts for landscaping services

• Owners of homes in newly built neighborhoods with no landscaping

• Homeowners with higher incomes

• Owners of homes who view the landscaping as a way to express their creative personality

A new landscaping business wants to identify customer segments to target for its services.

Select the correct segmentation for Demographic

• Homeowner who are highly price sensitive and open to promotional discounts for landscaping services

• Owners of homes in newly built neighborhoods with no landscaping

• Homeowners with higher incomes

• Owners of homes who view the landscaping as a way to express their creative personality