A franchise business can be started with purchasing a franchise rights, these rights are usually sold by chain businesses however there are some small businesses who also provide franchise.
<h3 /><h3>What is a Franchise?</h3>
A franchise is a legal right to run the operations of a business under the same name, however there are some factors that needs to be maintained these factors are mentioned in the agreement and must be met by the franchisee at all times.
In return for the franchise there is a lump sum payment which entitles the acquirer/ franchisee for the use of legal name of that business, also these rights are for a certain number of years.
For the duration of the franchise agreement the franchise owner is responsible for all the advertisement expenditure.
When starting a new business it is recommended that a franchise is acquired if they have no past experience of the business.
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Answer:
d. Statements a and c are correct
Explanation:
The primary market is the market where for the first time the new securities such as shares, stocks, bonds, etc. are being sold to the general public or we can refer initial public offer. The initial public offer is an example of the primary market
On the other side, the secondary market is that market where the shares are bought or sold through the investors after the sale to the public at large.
Answer:
Business plan necessary because:
•It make you aware of your strength or weakness.
•It also creates an effective strategy for growth.
•It helps to determine your future financial needs.
•It also helps to gain a deep understanding of your market.
Answer:
Aftertax income 47,278.7
Explanation:
Sales 14,600 units at $14.30 (10%Δ) 208,780
Cost of goods sold (unchanged) <u> (116,800) </u>
Gross profit 91,980
S&A expenses; 5% of sales
208,780 x 5% = (10,439)
Depreciation (unchanged) <u> (14,000) </u>
Operating profit 67,541
Taxes (30% of operating profit) <u> 20,262.3 </u>
Aftertax income 47,278.7
