The High Failure Rate Among New Ventures Is Due, in Part

question 62

Multiple Choice

The high failure rate among new ventures is due, in part, to the liability of newness, which refers to the fact that new companies often falter because ________.

• A) they are underfunded and the founders of the firms don't move quickly enough to put together boards of directors and boards of advisors that can provide them direction and advice
• B) the founders of the firms underestimate the complexities involved with starting a new business and the firms lack a "track record" with outside buyers and sellers
• C) the people who start the firms can't adjust quickly enough to their new roles and the firms lack a "track record" with outside buyers and sellers
• D) the people who start the firms can't adjust quickly enough to their new roles and they are underfunded
• E) the founders of the firms underestimate the complexities involved with starting a new business and they don't move quickly enough to establish business partnerships

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Definitions:

Cost Per Equivalent Unit

A calculation used in process costing that determines the cost assigned to individual units of production, considering units that are partially completed.

Processing Department

A unit within a manufacturing facility where a specific type of production activity or process is carried out, such as assembly or painting.

Total Cost Transferred

The aggregated cost that is moved from one department or process to another within a company.

Cost Reconciliation Report

A financial document that adjusts and aligns cost elements within a specific period or project to ensure accounting accuracy.