Reference no: EM132221266
1. Which statement would describe a company's strategies?
A) “The company is in business to provide expert real estate brokerage services to its customers.”
B) “The company will increase its market share to 7% by the end of 2006.”
C) “The company will fully integrate its mortgage department, title closing services, and selling activities to create one-stop shopping for customers.”
D) “The company will train its sales associates to make effective listing presentations.”
2. An S corporation offers the same advantages of a C corporation but has one very important advantage:
A) dividends to owners are tax-free, much like municipal bonds.
B) all income is tax-free to both the corporation and the shareholders.
C) S corporations need not pay the employer share of taxes such as Social Security and Medicare.
D) it avoids the double taxation that is a characteristic of a C corporation.
3. One of the disadvantages of a general partnership is that
A) the general partnership and the partners end up paying income taxes twice.
B) the general partners are not personally liable for partnership debts.
C) some of the partners are limited partners and don’t personally participate in the management of the firm.
D) the general partnership dissolves upon the death or bankruptcy of any of the partners.
4. A broker increased advertising this month by 40% and saw an increase in her listing and sales figures. Which statement would BEST illustrate what that month's income statement will show if she uses the accrual method of accounting?
A) It would show high advertising expenses when she paid the bill, but income would not show up until the sales closed in later months.
B) The gross income for accepted contracts would be immediately booked, and so would the advertising costs.
C) She would have low gross income until the contracts were closed, but expenses would also be lower until the contracts closed.
D) It would show higher gross income with lower advertising expenses.