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1985 State Cooperative Education Test



True/False
Indicate whether the sentence or statement is true or false.
 

 1. 

It is lawful for Ohio cooperatives to develop brand names.
 

 2. 

Cooperatives are an integral part of the American business system.
 

 3. 

A good source of credit for a farmer is the bank for cooperatives.
 

 4. 

A well-informed membership is not essential to the success of a cooperative
 

 5. 

Only members may deal with farmer cooperatives.
 

 6. 

Pooling is a practice commonly used by marketing cooperatives
 

 7. 

Patronage refunds received by patrons are exempt from federal income tax to the business.
 

 8. 

Agriculture is the only industry in the united States that uses cooperatives to do business.
 

 9. 

The Maximum real gross national product any nation can produce in any one year is limited most by its productive resources.
 

 10. 

The financial success of a cooperative depends entirely on the state and federal laws under which it is incorporated.
 

 11. 

The returns on invested capital in a cooperative incorporated in Ohio are limited to 8 Percent.
 

 12. 

The Ohio Sales Tax is not applicable to farmer cooperatives in the same way that it is to individuals.
 

 13. 

Co-ops are exempt from paying personal property taxes.
 

 14. 

State franchise taxes must be paid annually by every Ohio co-op.
 

 15. 

Net savings in a cooperative are distributed to members on basis of years of membership in the cooperative.
 

 16. 

Preferred stock investors in cooperatives have no voting privileges.
 

 17. 

Most of the money for establishing a cooperative should be provided by its members.
 

 18. 

Mutual insurance companies are among some of the earliest cooperatives organized in America.
 

 19. 

It is lawful for Ohio cooperatives to develop brand names.
 

 20. 

Cooperatives are an integral part of the American business system.
 

 21. 

A good source of credit for a farmer is the band for cooperatives.
 


Multiple Choice
Identify the letter of the choice that best completes the statement or answers the question.
 

 22. 

Determines the credit policy of the cooperative.

a.

Member

b.

Manager

c.

Director

 

 23. 

Establishes a fund to finance trips for contest winners to the AIC meeting.

a.

Member

b.

Director

c.

Manager

 

 24. 

Adopts the constitution of the cooperative.

a.

Manager

b.

Director

c.

Member

 

 25. 

Has the power to terminate the existence of the cooperative.

a.

Director

b.

Member

c.

Manager

 

 26. 

Decides to increase the fee charge to new members

a.

Directors

b.

Member

c.

Manager

 

 27. 

Handles complains of employees.

a.

Director

b.

Manager

c.

Member

 

 28. 

Prepares an annual report of the cooperative’s operations.

a.

Manager

b.

Member

c.

Director

 

 29. 

Decides weather the cooperative will declare a patronage or dividend refund.

a.

Director

b.

Member

c.

Manager

 

 30. 

Employs the manager of the cooperative.

a.

Manager

b.

Director

c.

Member

 

 31. 

Amends the articles of incorporation.

a.

Member

b.

Manager

c.

Director

 

 32. 

Determines which accounts are to be written off to bad debts.

a.

Manager

b.

Director

c.

Member

 

 33. 

Hires the auditor to perform the annual audit.

a.

Director

b.

Manager

c.

Member

 

 34. 

Profits distributed in proportion to amount of stock owed.

a.

Basic cooperative principles

b.

Not Basic cooperative principles

 

 35. 

Unlimited dividend paid on capital inverted.

a.

Basic cooperative principles

b.

Not Basic cooperative principles

 

 36. 

Votes for directors at annual stockholders meeting.

a.

Basic cooperative principles

b.

Not Basic cooperative principles     

 

 37. 

Profit distributed in proportion to amount of patronage.

a.

Basic cooperative principles

b.

Not Basic cooperative principles

 

 38. 

Democratic control.

a.

Basic cooperative principles

b.

Not Basic cooperative principles     

 

 39. 

Majority of business is done with members.

a.

Basic cooperative principles

b.

Not Basic cooperative principles

 

 40. 

The purpose is to obtain a service for the benefit of its members.

a.

Basic cooperative principles

b.

Not Basic cooperative principles

 

 41. 

Organize the cooperative at the outset.

a.

Members of the cooperative are responsible

b.

Members of the cooperative are NOT responsible

 

 42. 

Doing business with the cooperative.

a.

Members of the cooperative are responsible

b.

Members of the cooperative are NOT responsible

 

 43. 

Make capital investment if necessary.

a.

Members of the cooperative are responsible

b.

Members of the cooperative are NOT responsible

 

 44. 

Accept special assignments or responsibilities on a committee.

a.

Members of the cooperative are responsible

b.

Members of the cooperative are NOT responsible

 

 45. 

Farm cooperatives are distinguished from other forms of private enterprise in all of the following examples except:

a.

net savings are distributed on a patronage basis

b.

democratic control is by members as individuals rather than investors holding capitol stock

c.

returns are based on capitol investments by the members

d.

there are limited returns on invested capitol

 

 46. 

Under our present cooperatives’ farm credit system, real estate loans are generally obtained by farmers through

a.

Production Credit Associations

c.

Bank for Cooperatives

b.

Mutual Investment Associations

d.

Federal Land Bank Associations

 

 47. 

The Board of Directors of a farm cooperative is usually made of representatives who are:

a.

appointed by management

c.

elected by the voting members at the annual meetings

b.

elected by all the patrons

d.

elected by employees

 

 48. 

General farm organizations which are not  cooperatives but membership organizations devoted to social, educational and legislative work are:

a.

Farm Bureau Cooperative Association

c.

Farm Business Federation

b.

Grove City Farmers Exchange

d.

Ohio State Grange

 

 49. 

The president of a cooperative is usually selected by its:

a.

members

c.

management staff

b.

executive committee

d.

board of directors

 

 50. 

A farmer cooperative is owned by:

a.

outside investors

c.

members-patrons

b.

Farmer Cooperative Service

d.

Ohio Department of Agriculture

 

 51. 

The voting rights in a cooperative are usually based of each member having:

a.

a number of votes in proportion to the size of his farm business

b.

one vote for each share of stock owned

c.

one vote per member

d.

the number of votes in proportion to his length of membership in the cooperative

 

 52. 

In large cooperative business corporations, the company manages do not:

a.

own the business.

c.

set prices for company products

b.

receive part of the profits

d.

manage the day-to-day business

 

 53. 

The single most important purpose of a farmer cooperative is:

a.

promoting new farm legislation

b.

promoting modern agriculture products

c.

strengthening the individual member’s farm business

d.

aiding agricultural organizations

 

 54. 

In addition to following cooperative principles successful need to follow several important business practices. Some of the practices are:

a.

continuous growth

c.

competition among cooperatives

b.

selling at market prices

d.

neutrality in politics, race, and religion

 

 55. 

A cooperative’s net profits may go to:

a.

Patrons on the basis of years of ownership stock.

b.

Patrons at a rate prescribed at the beginning of each year.

c.

Patrons on the basis of dollars of business done with co-ops.

d.

Management employees as a bonus as determined by the directors.

 

 56. 

Cooperative principles are the guideposts that distinguish cooperatives from non-cooperative businesses.  Which of these is not a basic cooperative principal:

a.

Membership is limited to a select few

d.

Patronage refunds (operation at cost)

b.

Democratic control

e.

Continuous education

c.

Limited or no interest on equity capital

 

 57. 

Operational planning for a cooperative involves short range day to day planning that is responsibility of the directors

a.

True

b.

False

 

 58. 

The board of directors--not the membership--determines the cooperatives managers salary

a.

True

b.

False

 

 59. 

Seek information on operations and affairs.

a.

members are responsible

b.

Members are NOT responsible

 

 60. 

Seek employment of relatives.

a.

Members are responsible

b.

Members are NOT responsible

 

 61. 

Expect special privileges from the cooperative.

a.

Members are responsible

b.

Members are NOT responsible

 

 62. 

Attend all general and annual meetings.

a.

Members are responsible

b.

Members are NOT responsible

 

 63. 

Approve the budget for the coming year.

a.

Members are responsible

b.

Members are NOT responsible

 

 64. 

Request changes to meet expanding requirements.

a.

Members are responsible

b.

Members are NOT responsible

 

 65. 

Establish credit policy.

a.

Directors are responsible

b.

Directors are NOT responsible

 

 66. 

Employ operating personal.

a.

Directors are responsible

b.

Directors are NOT responsible

 

 67. 

Run the business.

a.

Directors are responsible

b.

Directors are NOT responsible

 

 68. 

Approval the general plan of operation.

a.

Directors are responsible

b.

Directors are NOT responsible

 

 69. 

Conduct staff training.

a.

Directors are responsible

b.

Directors are NOT responsible

 

 70. 

Handle employee complaints.

a.

Directors are responsible

b.

Directors are NOT responsible

 

 71. 

Decide whether it is possible to pay patronage refund and what percentage of the refund is to be paid in cash.

a.

Directors are responsible

b.

Directors are NOT responsible

 

 72. 

Decide to merge with other business firms.

a.

Directors are responsible

b.

Directors are NOT responsible

 

 73. 

Engage auditor.

a.

Directors are responsible

b.

Directors are not responsible

 

 74. 

Borrow money for the association

a.

Directors are responsible

b.

Directors are not responsible

 

 75. 

When the member patrons cover a fairly broad geographic area and structure their cooperatives business to provide a service or product at locations convenient to members throughout the area and when the members are direct members of the regional, then the cooperative is known as a centralized cooperative.  Some of the benefits or advantages of the centralized system of cooperative organizations are:

a.

More efficient management control of purchasing and marketing

b.

More selective hiring of managers

c.

Equitable distribution of savings

d.

Grassroots control for better management responsiveness to members

 

 76. 

When member patrons organized their own businesses, then join others to provide themselves with inputs to employ economies of scale or to have more market influence, then their cooperatives are known as being a federated system .  Some benefits of the federated systems are:

a.

Quicker response to changing conditions

b.

Consistency of pricing

c.

Local control (grassroots) for improved management responsiveness

d.

Increased member understanding and loyalty due to more direct involvement

e.

More recognition by the member patrons of need for adequate financing

 



 

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