Test your basic knowledge |

Small Business Management

Instructions:

Answer 50 questions in 15 minutes.
If you are not ready to take this test, you can study here.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

1. A form of legal organization in which a business association made up of two or more persons is formed for the purpose of carrying on as co-owners is known as a...
Name of the business; Goodwill
Legal restrictions on activities; Lack of personal interest
partnership
break-even point

2. Which of the following would NOT be an insurance risk to consider?
Credit customers are more interested in quality and service than price
Tax burdens; Human resource planning
Take on more risks
Terms of the sale

3. 2/10 - N/30 means...
Divided authority among partners; Death or incapacity of one of the partners may end the partnership
Indemnity
a 2% discount if invoice is paid within 10 days - net due in 30 days
consumer credit

4. Which of the following are advantages of a partnership?
lost income
working capital; circulating capital
sales promotions
Efficiency of labor; Combined management - talent and capital

5. Which of the following is an internal problem that can contribute to the failure of a business?
the employment interview
risk management
Financial shortages
entrepreneur

6. Any credit that is extended from one business to another in order to help finance the distribution of goods from the producer is called...
manufacturing business
trade credit
to self-insure
Lack of expertise

7. The combination of two or more individual's talents and capital serves as an advantage of the legal form of ownership known as a...
Tax burdens; Human resource planning
the religion of the applicant
partnership
Whether or not they have an acceptable accounts receivable ratio

8. The form of legal organization that is owned and operated by one person is the...
Equal Pay Act of 1963
2/10 - N30
commercial loans
proprietorship

9. A business that purchases finished goods for resale is referred to as a...
merchandising business
competition
proprietorship
Better Business Bureau

10. Selling a business's accounts receivable for cash to a third party is referred to as...
key person insurance
to self-insure
factoring
demographics

11. Any effort undertaken to retain and preserve the assets and earning power of a business is called...
consumerism
Small Business Administration
fixed expense
risk management

12. Whenever a business must pay for the merchandise before its delivery - which of the sales terms apply?
have good management
Better Business Bureau
equity capital; personal capital
CBD

13. Which of the following is NOT a type of consumer credit?
economic base
inventory turnover
advertising
Personal checks

14. Life insurance that protects a firm against losses due to the death of a key employee is known as...
key person insurance
Large financial capacity; Limited liability of each owner (stockholder)
sales promotions
equity capital

15. The principal government agency concerned with the financing - operation - and management of small businesses is the
fixed expense
Small Business Administration
Tax burdens; Human resource planning
equity capital; personal capital

16. A document that lists the major responsibilities and tasks of the job is known as a job
description
Whether or not they have an acceptable accounts receivable ratio
Census of banking
risk management

17. All of the following are factors which can affect the recruitment and selection of employees except
a 2% discount if invoice is paid within 10 days - net due in 30 days
service business
market
the religion of the applicant

18. A business that makes finished goods from raw materials by hand or machinery is referred to as a...
fixed capital
inventory turnover
Divided authority among partners; Death or incapacity of one of the partners may end the partnership
manufacturing business

19. Any capital that is invested in a business by the owner(s) can be called...
fixed expense
sole proprietorship
equity capital
Whether or not they have an acceptable accounts receivable ratio

20. In business - the name - goodwill - copyrights - and patents are referred to as...
Applicant's sex
Financial shortages
intangible assets
Tax burdens; Human resource planning

21. A line of credit that may b e used over and over again up to a certain borrowing limit is called...
revolving account; open-end credit
markdown
manufacturing business
Personal checks

22. The art of making the public aware of one's products and/or services that are for sale can be referred to as...
mark-up
Credit customers are more interested in quality and service than price
market
advertising

23. A written description of a new idea that projects marketing - operational - and financial aspects of a proposed business is known as...
demographics
a business plan
entrepreneur
consumerism

24. The current asset items consisting of cash - inventories - and accounts receivables is known as...
Directing
have good management
circulating capital
consumer credit

25. Long term capital invested in the business is...
fixed capital
markdown
Whether or not they have an acceptable accounts receivable ratio
Financial shortages

26. An individual that assumes the risks associated with a new venture start-up can be referred to as a...
equity capital
entrepreneur
Installment credit
Sales are increased; Goodwill is built-up and easily maintained

27. Which of the following is not a consideration concerning the selection of suppliers?
Whether or not they have an acceptable accounts receivable ratio
Some losses from bad debts and customers with fraudulent intentions are bound to occur
Equal Pay Act of 1963
Commercial loans; Venture capitalists

28. One who organizes - manages - and assumes the risk of a business form or venture is known as...
an entrepreneur
Better Business Bureau
circulating capital
a 2% discount if invoice is paid within 10 days - net due in 30 days

29. Which of the following is NOT a consumer buying motive?
Indemnity
Chamber of Commerce
Income trends in the community
the employment interview

30. Business interruption insurance covers
Financial shortages
trade credit
lost income
circulating capital

31. Capital that is investe4d in the business by the owner(s) is known as...
equity capital; personal capital
Directing
Personal checks
to determine where the potential customers are

32. Which of the following are disadvantages of a partnership?
Divided authority among partners; Death or incapacity of one of the partners may end the partnership
Proprietorship
Whether or not they have an acceptable accounts receivable ratio
market

33. Which of the following are advantages of a corporation?
proprietorship
variable expense
Large financial capacity; Limited liability of each owner (stockholder)
Accessibility

34. An association of business people who attempt to protect and promote the commercial interests in a community is known as the...
have good management
mark-up
inventory turnover
Chamber of Commerce

35. Which of the following are disadvantages of a sole proprietorship?
Legal restrictions on activities
Unlimited liability; Limited management ability
credit application
fixed capital

36. An interview whereby the applicant is asked a pre-determined set of questions is known as...
fixed expense
trade credit
a structured interview
Sales are increased; Goodwill is built-up and easily maintained

37. Which of the following is NOT a way to reduce risks?
a 2% discount if invoice is paid within 10 days - net due in 30 days
fixed capital
Better Business Bureau
Take on more risks

38. If a prospective business owner attempts to statistically study such factors as human population size - density - distribution - and wealth - we should refer to this as...
Census of banking
inventory turnover
Equal Pay Act of 1963
demographics

39. Which of the following are examples of debt capital?
Commercial loans; Venture capitalists
consumer credit
a qualification that is absolutely necessary
Actively managed by stockholders

40. The number of times the average inventory has been sold or used up during a period is known as...
inventory turnover
CBD
working capital
consumer credit

41. Which of the following refers to those activities which encourage subordinates to work toward the achievement of the company's goals?
working capital; circulating capital
to self-insure
credit application
Directing

42. Which of the following has the disadvantage of no limit being placed on the owner's personal liability?
Efficiency of labor; Combined management - talent and capital
Unlimited liability; Limited management ability
Proprietorship
entrepreneur

43. The type of consumer credit where the balance is paid in small monthly (fractional) payments over a period of time is...
proprietorship
markdown
Installment credit
factoring

44. The difference between merchandise cost and the selling price is known as the...
Unlimited liability; Limited management ability
Whether or not they have an acceptable accounts receivable ratio
mark-up
markdown

45. A plan which provides inducements to potential purchasers of products and/or services is called...
Installment credit
economic base
sales promotions
corporation

46. A strategy available to absorb risks would be...
Whether or not they have an acceptable accounts receivable ratio
Divided authority among partners; Death or incapacity of one of the partners may end the partnership
working capital
to self-insure

47. Which of the following is an example of a variable expense?
Equal Pay Act of 1963
manufacturing business
Repairs
2/10 - N30

48. A group of potential customers that are recognized as possessing purchasing power and unsatisfied needs defines...
a 2% discount if invoice is paid within 10 days - net due in 30 days
proprietorship
market
Directing

49. Legislation that guarantees disabled people equal access to employment - as well as access to public places - is known as...
CBD
the employment interview
ADA
market

50. Which of the following is a requirement for a building layout?
break-even point
variable expense
Accessibility
Small Business Administration