What Are the Consequences of Diversification for Corporate Performance

question 77

Multiple Choice

What are the consequences of diversification for corporate performance?

• A)It rarely creates value
• B)It nearly always destroys value
• C)It may create or destroy value, depending largely on how sensible it is and how well it is executed
• D)None of the above

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Definitions:

Net Sales

The total revenue from sales of goods or services, after deducting returns, allowances for damaged or missing goods, and any discounts given.

Gross Sales

Gross Sales are the total sales income of a business before any deductions are made for returns, allowances, or discounts.

Sales Discounts

A decrease in the cost of products or services provided to consumers, usually to encourage prompt payment or large-scale buying.

Account Category

A classification or grouping used in accounting to organize financial transactions, such as assets, liabilities, revenue, and expenses.