Principles of Entrepreneurship Ch-6-10 Review

Indicate whether the statement is true or false: Even if your business uses the perpetual inventory method, you will need to take a physical inventory at least once or twice annually.

• True

• False

Indicate whether the statement is true or false: State and federal laws require that the franchisor provide the Franchise Disclosure Document (FDD) to prospective franchisees 14 days before the franchisee signs a contract.

• True

• False

Indicate whether the statement is true or false: Fewer than 100,000 people in the United States own franchises, and the popularity of franchise ownership is declining rapidly.

• True

• False

Indicate whether the statement is true or false: Income earned by a sole proprietorship is taxed twice: once as company income and again as individual income.

• True

• False

Indicate whether the statement is true or false: The layout of a wholesale business needs only to be efficient and well organized.

• True

• False

Indicate whether the statement is true or false: Typically, only very small businesses use the cash method.

• True

• False

Indicate whether the statement is true or false: The copyright on a book remains in effect until the author dies.

• True

• False

Indicate whether the statement is true or false: According to some estimates, as many as 90 percent of all businesses, including the vast majority of small- and medium-sized companies, are owned by families.

• True

• False

Indicate whether the statement is true or false: Using the telephone to promote your product is called phishing.

• True

• False

Indicate whether the statement is true or false: Increasing payroll can improve a business’s cash flow.

• True

• False