I've seen many companies that have a cartoon animal in their logo, or perhaps even a real photo of something. When they paid for the logo, did the person that created it, draw the animal/bought the rights to use the photo?

Or did they use free clipart available? And what would happen if you created/bought a logo that contained a copyrighted image?

A lot depends on who they got to design it. If they used a professional design firm, the graphics could be custom-made or the photos paid for stock art. If they got their buddy's little brother to do it, it might be hand-drawn art if the person has any talent, most likely freebie clipart or stock art.. or even pirated.

Thanks for the clarification, I had a feeling it worked that way. I usually used free clipart, or gave a shot at making my own.