3. A business entity which taxes it owners like partners while providing those owners with limited liability is
a. general partnership.
limited liability company.
d. sole proprietorship.
e. limited proprietorship.
Ross - Chapter 001 #13
TOPIC: LIMITED LIABILITY COMPANY
4. Tracie deposits $5,000 into an account that pays 3 percent interest compounded annually. Chris deposits
$5,000 into an account that pays 3 percent simple interest. Both deposits were made this morning. Which of the
following statements are true concerning these two accounts?
I. At the end of one year, both Tracie and Chris will have the same amount in their accounts.
II. At the end of five years, Tracie will have more money in her account than Chris has in his.
III. Chris will never earn any interest on interest.
IV. All else equal, Chris made the better investment.
a. I and II only
b. III and IV only
I, II, and III only
d. II, III, and IV only
e. I, III, and IV only
Ross - Chapter 005 #13
TOPIC: SIMPLE VERSUS COMPOUND INTEREST
5. A project has a contribution margin of $6, projected fixed costs of $14,000, projected variable cost per unit of
$14, and a projected financial break-even point of 6,000 units. What is the operating cash flow at this level of
Operating cash flow at the financial break-even point = (6,000
$14,000 = $22,000
AACSB TOPIC: ANALYTIC
Ross - Chapter 011 #81
TOPIC: FINANCIAL BREAK-EVEN