Value-Added Activities

question 121

Multiple Choice

Value-added activities

• A) should be minimized or eliminated.
• B) involve those activities that are essential to a company's operations.
• C) add cost to a product without affecting selling price.
• D) cannot be differentiated from non-value-added activities.

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Definitions:

Tender Offer

An offer to purchase some or all of shareholders' shares in a corporation, typically at a premium to the market price, as part of a corporate acquisition or buyback.

Equity Securities

Financial instruments representing ownership interest in a corporation, such as stocks, which confer certain rights like voting and profit sharing.

Specified Price

A determined cost set for a product or service, agreed upon by the seller and the buyer.

Rule 506

A provision of the Securities Act that allows companies to raise unlimited capital through private placements without extensive registration with the SEC.