HIGHLINE COMMUNITY COLLEGE
BUSN155 - Entrepreneurship
Spring - 2005
Question 1 Multiple Choice 10 points
A "pushing" promotional strategy is:
Designed to promote one item, at a time and place near the actual purchase
Designed to encourage the consumer to ask for the product if the retailer does not
Primarily used when goods or services are marketed to the ultimate consumer.
Designed to market the product to wholesalers and retailers.
Question 2 Multiple Choice 10 points
Which of the following groups would have the LEAST interest in the company's financial
Question 3 Multiple Choice 10 points
Which of the following would not normally be considered a part of a promotional
Changes in production capacity
Question 4 Multiple Choice 10 points
The paths that goods and services follow from producer to consumer are known as:
The wheel of retailing
Question 5 Multiple Choice 10 points
In break-even analysis, the costs that change with the level of sales are called:
Question 6 Multiple Choice 10 points
The Social Club is performing a break-even analysis to determine how many tickets it
must sell at $15 each to break even on the Holiday Dance. Fixed Costs are $2,000 and
the Variable Cost per person is $10. How many tickets must be sold in order to break
Question 7 Multiple Choice 10 points
Pure Products has a new reusable coffee filter that is almost ready to offer for sale. The
company believes that the Product Life Cycle will be very long for this item, and because
the product is relatively easy to manufacture they believe that competitors could emerge
soon after the product introduction. What pricing strategy would you recommend to Pure
Question 8 Multiple Choice 10 points
In which stage of the Product Life Cycle do competitors enter the market with similar
Question 9 Multiple Choice 10 points
When a firm uses $100,000 in cash to pay dividends to owners, Assets will _____ by
$100,000, and Owners Equity will _____ by $100,000.
Question 10 Multiple Choice 10 points
Tank Tops Unlimited is conducting a break-even analysis on unbleached cotton tops.
Fixed Costs are $100,000 and the per-unit contribution to fixed costs is $20. To break
even, how many tank tops must be sold?
Question 11 Multiple Choice 10 points
Which accounting statement is based on the accounting equation?
Owners Equity Statement
Question 12 Multiple Choice 10 points
Betty is considering buying stock in Microsoft. As a user of accounting information, she
would be most interested in using this information to do what?
Plan and control
Improve contract negotiations
Evaluate credit ratings
In order to make an investment decision
Question 13 Multiple Choice 10 points
Boring, Inc., has $50 million in assets and $30 million in owners equity. How much
does the firm have in liabilities?
Question 14 Multiple Choice 10 points
Choktaw Products buys a $500,000 machine by taking out a bank loan. The
company's assets will ___ by $500,000, while it's liabilities will ___ by $500,000.
Question 15 Multiple Choice 10 points
Which of the following assets would be listed first on the assets side of a Balance
Question 16 Multiple Choice 10 points
By definition, all Current Liabilities are due within what time period?
Question 17 Multiple Choice 10 points
If a company sells products on credit, which Balance Sheet account would be affected?
Question 18 Multiple Choice 10 points
Anything of value that is used by a company for periods longer than one year is
considered a(n) ______.
Question 19 Multiple Choice 10 points
Which of the following is NOT included when calculating the quick, or "acid-test" ratio?
All of these are used to calculate the ratio.
Question 20 Multiple Choice 10 points
Last year a firm had a Current Ratio of 1.5 and a Quick (Acid-test) Ratio of 0.75. This
year the firm's Current Ratio is 2.0 and it's Quick Ratio is 1.0. This firm's ____ has
Question 21 Multiple Choice 10 points
Which of the following are designed to indicate how successful a firm is in terms of its
earnings as compared with its assets or owners equity.
Question 22 Multiple Choice 10 points
All of the following are cash inflows except ______.
Collection of Accounts Receivable
Sales on Credit
Question 23 Multiple Choice 10 points
Many retailers have seasonal sales - sales are heaviest during the last three months of
the year. Given that retailers have to build up inventories in anticipation of sales, in
which quarter will many retailers experience significantly negative cash flow?
First: January through March
Second: April through June
Third: July though September
Fourth: October through December
Question 24 Multiple Choice 10 points
A Business Plan ________.
Is meant to be looked at once a year.
Should be used when developing business strategies.
Is only needed if you are borrowing money.
Is not as important as aMarketing Plan.
Question 25 Multiple Choice 10 points
At year-end, Cost of Goods Sold is $150,000. Beginning Inventory was $20,000, and
Purchases were $160,000 during the year. What is the Inventory Turnover Ratio?
Not enough information
Question 26 Multiple Choice 10 points
The purpose of Inventory Management is:
To have inventory when you need it.
To not tie up too much capital in inventory.
To make sure quality of purchased items is consistent.
All of these.
Question 27 Multiple Choice 10 points
I have friends across the country who are operating exactly the same type of store as I
am, selling the same type of goods. We meet once a year to compare notes, and this
year I found out that everyone else has an Inventory Turnover Ratio of 6, while mine is
only 3. What might I learn from this?
My inventory level is too high compared to my friends.
My prices are too high compared to my friends.
My sales are lower compared to my friends.
All of the above.
Question 28 Multiple Choice 10 points
The benefits of utilizing a web site include which of these?
Increased sales of products, lower marketing costs.
I can decrease my sales tax bill.
I can decrease my product liability insurance.
I can reduce the time I spend managing my business.
Question 29 Multiple Choice 10 points
The biggest concern of shoppers on the internet is____.
That prices will be higher than if they bought the items locally.
Privacy and security.
Availability of different styles and colors.
Question 30 Multiple Choice 10 points
The biggest reason customers are lost is:
They move away.
They find the item cheaper elsewhere.
We ignore them.
They have a friend who recommends that they try some other company.