Deck 4: The Organization of an Agribusiness

Question 1

Cooperatives are member---------------------and member ---------------

Answer 1

owned controlled

Question 2

------------------------------- allow cooperatives to distribute net returns or margins to members or patrons.

Answer 2

Patronage refunds

Question 3

A -------------------------------partner permits individuals to contribute money or other ownership capital without incurring the full legal liability of a general partner.

Answer 3

limited

Question 4

One of the three specific features that delineate cooperatives from non-cooperative businesses is to operate at -------------------------------.

Question 5

-------------------------------stock usually carries the privilege of voting for the board of directors.

Question 6

The form of business organization in the US that generated the greatest amount in business receipts in 2006 was the

A) Single proprietorship
B) Partnership
C) Corporation
D) Cooperative

Question 7

A disadvantage of a partnership is

A) Unlimited liability of each general partner
B) It is about as easy to start as a proprietorship
C) Partners, as individuals, pay income taxes only on the income generated from their share of the profit.
D) None of the above

Question 8

A partner is an individual who cannot take an active role in management, but is known to be a partner by the general public.

A) Dormant
B) Secret
C) Silent
D) Nominal

Question 9

The legal document of a corporation that specifies such rules of operation as the election of directors, duties of officers and directors, voting procedures, and dissolution procedures is called

A) Bylaws
B) Articles of incorporation
C) Resolution to borrow
D) None of the above

Question 10

Qualification(s) that must be met to form an S-corporation include:

A) Cannot be more than 100 stockholders
B) Stockholders must be individual persons rather than corporations
C) The election to be taxed as individuals may occur any time during the fiscal year, but prior to filing income taxes each year
D) Domestic corporation
E) Both a and b

Question 11

A disadvantage of forming a corporation is that

A) Stockholders are not personally liable for the debts of the corporation
B) Double taxation
C) Perpetual life
D) All of the above

Question 12

An example of a partner that would not be active in management and would not be known to the public would be

A) Secret
B) Silent
C) Dormant
D) Nominal

Question 13

Advantage(s) of a proprietorship form of organization is (are)

A) Minimal legal requirements needed to start
B) Owner has complete control over the business
C) Pays no income tax as a separate business entity
D) All of the above

Question 14

Advantage(s) of a strategic alliance is (are)

A) Firms can collaborate on technology or the development of new products
B) Firms can improve supply chain efficiency
C) Firms can gain economies of scale in production and/or marketing
D) All of the above

Question 15

In 2006, _____ percent of all US corporations had annual receipts of less than $1 million

A) 7
B) 100
C) 81
D) None of the above

Question 16

In 2006, single proprietorships accounted for 4 percent of total US business receipts.

Question 17

A partnership pays no income tax as a separate business entity.

Question 18

In a limited partnership, each individual partner, regardless of the percentage of capital contributed, has equal rights and liabilities, unless stated otherwise in a partnership agreement.

Question 19

A corporation is a special legal entity endowed by law with the powers, rights, liabilities, and duties of a person.

Question 20

In 2006, about 83 percent of all US business annual receipts came from proprietorships.

Question 21

The greatest advantage of the corporate form of organization is taxation and regulation.

Question 22

A relatively new type of business organization that closely resembles a partnership, but provides its members limited liability is a limited liability company.

Question 23

Each state has what are called "blue-sky laws," which regulate the way in which corporation stock may be sold and which protect the rights of investors.

Question 24

One disadvantage of a cooperative is that in many states each member only has one vote regardless of how many shares of cooperative stock the individual owns.

Question 25

The legal document that is filed with the state and which sets forth the basic purpose of a corporation and the means of financing is called the articles of incorporation.

Question 26

Why is it relatively easy to start a sole proprietorship?

Question 27

What is a "silent" partner?

Question 28

What functions do boards of directors provide for a corporation?

Question 29

One of the operating principles of cooperatives is "operation at cost." What does this mean?

Question 30

Define what "patronage refunds" are in a cooperative.

Question 31

Explain the concept of revolving fund financing in cooperatives.