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Prelim Examination in Business finance (Part 1)

Total questions: 77

Worksheet time: 2hrs 5mins

Name
Class
Date
1.

Unlimited personal responsibility for all debts and for other liabilities that the business may incur is only possible in a sole proprietorship form of business.

a)

true

b)

false

2.

Limited partners do not usually share in the managerial control of the business.

a)

true

b)

false

3.

The partnership and all partners are liable when any partner commits a tort while acting within the scope of the firm's business.

a)

true

b)

false

4.

When one partner is served with summons and complaint against the firm, all the partners are deemed to have received the notice, even if they are not informed.

a)

true

b)

false

5.

A corporation that files for bankruptcy must be dissolved.

a)

true

b)

false

6.

Of the three principal forms, the simplest, most flexible, and easiest to start is the sole proprietorship.

a)

true

b)

false

7.

Each partner has the ______ to carry on the business.

a)

agent

b)

equal

c)

authority

d)

creditor

8.

_______ agreement of the partners is required before a written partnership agreement can be changed.

a)

Unanimous

b)

compete

c)

equal

d)

agent

9.

A minor entering into a partnership agreement

a)

retains all the rights and privileges of a minor

b)

can only function as a limited partner

c)

cannot plead minority as defense if sued

d)

none of these

10.

A partner who invests more capital, brings in more business, or works longer and harder than his or her associates is entitled to

a)

a larger percentage of the business

b)

a larger share of the profits

c)

extra pay

d)

no extra compensation unless all partners agree

11.

The application for incorporation filed with a state government is termed the

a)

articles of incorporation

b)

business judgement rule

c)

bylaws

d)

stock certificate

12.

A corporation has the power

a)

of perpetual succession

b)

to make its own bylaws

c)

to use any legal means to conduct authorized business

d)

all of these

13.

Which of the following statements regarding a limited partnership is NOT true?

a)

one partner must be a general partner with limited liability

b)

one partner must be a general partner with unlimited liability

c)

one or more partners may have limited liability to the extent of their investment

d)

none of these

14.

Shared decision-making is an advantage of what type of organization?

a)

Sole trader

b)

Private limited company

c)

Public limited company

d)

Partnership

15.

Is Owned by a single individual called proprietor.

a)

PARTNERSHIP

b)

CORPORATION

c)

SOLE PROPRIETORSHIP

d)

FRANCHISE

16.

Is run by two or more individuals who join together to contribute capital to a common fund.

a)

PARTNERSHIP

b)

CORPORATION

c)

SOLE PROPRIETORSHIP

d)

FRANCHISE

17.

Is owned by shareholders. It is structured as a separate

legal entity under the operation of law.

a)

PARTNERSHIP

b)

CORPORATION

c)

SOLE PROPRIETORSHIP

d)

FRANCHISE

18.

Advantages:

- cheap to organize

- easy to start and operate

- retention of profits to owner

a)

PARTNERSHIP

b)

CORPORATION

c)

SOLE PROPRIETORSHIP

d)

FRANCHISE

19.

Advantages:

- ownership divided into shares of stock

- management or decision-making

shared by board of directors

a)

PARTNERSHIP

b)

CORPORATION

c)

SOLE PROPRIETORSHIP

d)

FRANCHISE

20.

Advantages:

- ownership by a group of individuals

- shared responsibility for any profits,

debts and decisions related to the business

a)

PARTNERSHIP

b)

CORPORATION

c)

SOLE PROPRIETORSHIP

d)

FRANCHISE

21.

Disadvantages:

- more expenses involved

- more rules and regulations to comply with

a)

PARTNERSHIP

b)

CORPORATION

c)

SOLE PROPRIETORSHIP

d)

FRANCHISE

22.

Sole proprietors have ____________, a situation in which a business owner is responsible for all the losses, debts, and other claims against the business.

a)

unlimited liability

b)

limited liability

c)

legal immunity

d)

dividend

23.

A _________ acts like a business, but its purpose is to benefit society.

a)

Franchise

b)

Limited Liability Partnership

c)

Nonprofit organization

d)

corporation

24.

A __________ is a form of business organization recognized by law as a separate legal entity having all the rights of an individual. It has the right to buy and sell property, enter into legal contracts, and sue and be sued.

a)

corporation

b)

partnership

c)

conglomerate

d)

proprietorship

25.

What is the name for an individual who owns a share of a corporation and is entitled to part of its profits?

a)

stockholder

b)

president

c)

officer

d)

director

26.
Which of the following is NOT one of the six basic activities that all businesses perform?
a)
raising capital
b)
buying goods and services
c)
conserving resources
d)
generating ideas
27.
A(n) ______ is a short, specific written declaration of the reason a business exists and what it wants to achieve.
a)
statement of intent
b)
affirmation of purpose
c)
mission statement
d)
declaration of principle
28.
__________ are precise statements of results a business expects to achieve.
a)
Goals
b)
Policies
c)
Strategies
d)
Articles of Incorporation
29.
Physicians, web designers, and furniture movers are 
a)
intermediaries
b)
nonprofit corporations
c)
manufacturers
d)
service businesses
30.
Policies are descriptions of the way work is to be done.
a)
True
b)
False
31.

A business organization that has unlimited life

(a)  

32.

A form of business organization that has juridical personality separate from its owner

(a)  

33.

The owner's liability is up and beyond its personal assets

(a)  

34.

It has the convenience of decision making as nobody has the power to oppose

(a)  

35.

Unlimited liability means

a)

Business owner is not responsible for financial loss

b)

Business owner is responsible for all financial losses

c)

Business owner pays only half financial loss

d)

Business owner pays taxes

36.

Which of these is an advantage of a sole proprietorship?

a)

It is recognized as a separate legal entity.

b)

It is easy to attract qualified employees.

c)

The owner does not have to share the profits of the business with anyone else.

d)

The proprietor does not have to pay income taxes for the business.

37.

Which type of business offers the best chance for quick decision-making?

a)

Sole proprietorship

b)

General partnership

c)

Limited partnership

d)

Corporation

38.

The problem with Sole proprietorship is that business owners have to pay for all the debts and this is known as (a)  

39.

In a Sole proprietorship owner keeps all the (a)  

40.

Sole proprioterships usually end if the owner dies this is known as ____

a)

limited life

b)

unlimited life

c)

unlimtied liability

d)

limited liability

41.

Sole proprietorship a business owned and run by a

a)

group of 10

b)

group of 5

c)

two people

d)

single person

42.
Which of the following is an advantage of a sole proprietorship
a)
easy to start up
b)
Decisions do not require the approval of a co-owner, boss, or other "higher-up
c)
the owner can keep the profits of successful management without having to share them with other owners. 
d)
All the other options
43.
Which of the following is a disadvantage of a sole proprietorship? 
a)
it is easy to start
b)
he owner is personally and fully responsible for all losses and debts of the business. If the business fails, the owner’s personal possessions may be taken away to satisfy business debts.
c)
requires a partner
d)
it is easy to raise the financial capital to start
44.
Which of the following is an advantage of a partnership? 
a)
they are hard to start
b)
management is hard between two or more people
c)
 partnerships can usually attract financial capital more easily than proprietorships.
d)
They are inefficient. 
45.
Which of the following is a disadvantage of a partnership? 
a)
 If one partner causes the firm to suffer a huge loss, each partner is fully and personally responsible for the loss.
b)
When a partner dies or leaves, the partnership must be dissolved and reorganized as a new partnership if the remaining partners want to stay in business.
c)
the potential for conflict between partners. 
d)
all the options are disadvantages
46.
Which of the following is a disadvantage of a corporation?
a)
it is easy to raise financial capital using stocks, bonds, or loans. 
b)
 the double taxation of corporate profits. Profits are taxed the first time when the corporation pays income taxes. The profits are taxed a second time when shareholders pay taxes on their dividends.
c)
it is easy to get a charter to start a corporation. 
d)
Owners and shareholders have total control over what happens with the business. 
47.
Which of the following is an advantage of a corporation?
a)
all other answers are advantages. 
b)
 the corporation provides limited liability for its owners. This means that the corporation itself, not its owners, is fully responsible for its obligations.
c)
 the corporation's board of directors can hire professional managers to run the firm. This means that the corporation's owners, its stockholders, can own a portion of the corporation without having to know much about the business itself.
d)
unlimited life, meaning that the corporation continues to exist even when shareholders sell their ownership shares of stock to someone else. Because the corporation is recognized as a separate legal entity, the name of the company stays the same, and the corporation continues to do business.
48.

Automobiles

a)

Manufacturing

b)

Service

c)

retailing

49.

Gardeners

a)

Manufacturing

b)

Services

c)

Retailing

50.

Electricity

a)

Manufacturing

b)

Services

c)

Retailing

51.

Canned Products

a)

Manufacturing

b)

Services

c)

Retailing

52.

Food Carts

a)

Manufacturing

b)

Services

c)

Retailing

53.

Car Rentals

a)

Manufacturing

b)

Services

c)

Retailing

54.

Schools

a)

Manufacturing

b)

Services

c)

Retailing

55.

Sari-sari Stores

a)

Manufacturing

b)

Services

c)

Retailing

56.

Medical Clinics

a)

Manufacturing

b)

Services

c)

Retailing

57.

Catering

a)

Manufacturing

b)

Services

c)

Retailing

58.

Transportation

a)

Manufacturing

b)

Services

c)

Retailing

59.

Maynilad Water or Prime Water

a)

Manufacturing

b)

Services

c)

Retailing

60.

Texttiles

a)

Manufacturing

b)

Services

c)

Retailing

61.

Furniture

a)

Manufacturing

b)

Services

c)

Retailing

62.

Lazada/ Shopee

a)

Manufacturing

b)

Services

c)

Retailing

63.

Wet and Dry Markets

a)

Manufacturing

b)

Services

c)

Retailing

64.

M (a)   is the process whereby raw materials undergo some processor until they are converted into finished products.

65.

(a)   are those offered by persons who are skilled in a trade or a craft.

66.

(a)   refers to all forms of selling goods directly to the consumers.

67.

Legal Consultation

a)

Manufacturing

b)

Services

c)

Retailing

68.

Define Partnership.

4 lines
69.

Define Corporation

4 lines
70.

What do entrepreneurs do?

a)

Purchase goods from the businesses.

b)

Take risks and start a new business.

c)

They contribute to the unemployment rate.

d)

They inform the government on how the spending and consuming of the economy should happen.

71.

Which one is incorrect between the successful entrepreneurs?

a)

Worked hard.

b)

Overcame disillusionment and failure.

c)

Never struggled.

d)

Remained enthusiastic about their enterprise.

72.

TRUE OR FALSE

The entrepreneurial process is a process through which a new venture is created.

a)

TRUE

b)

FALSE

73.

Which ward is match to picture?

a)

Plan

b)

Target

c)

Idea

74.

Which ward is match to picture?

a)

Launch

b)

Partners

c)

Marketing

75.

Which ward is match to pictures?

a)

Funding

b)

Plan

c)

Risk

76.

Q: Choose the word that matches this definition :

Money given by a government or organization for entrepreneurs to start their business

a)

Funding

b)

Plan

c)

Risk

77.

The four P’s of the Marketing Mix are: Place, Price, (a)   , Promotion

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