ANC Inc Operates with Planning Horizons Greater Than Five Years

question 44

Multiple Choice

ANC Inc. operates with planning horizons greater than five years. However, it is difficult to predict competitive conditions five years in the future, so the top managers implement a plan that involves regular reviews and updates in all levels of the company. The plan enables the company to respond quickly and to make adjustments as necessary. This is an example of a(n) ________ plan.

• A)short-term
• B)long-term
• C)intermediate-term
• D)rolling
• E)annual

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Definitions:

Profitability

The ability of a company to generate earnings relative to its revenue, assets, or equity over a specific period, indicating its financial health.

Vertical Analysis

A financial method that expresses each item within a financial statement in percentage terms of a base figure for the same time period, facilitating comparison.

Base Amount

A reference value or starting point used in financial calculations or comparisons.

Vertical Analysis

A financial analysis method that lists each line item as a percentage of a base figure within the same financial statement.