Many Firms Benefit from an Increasing Ability to Outsource Manufacturing

question 57

Multiple Choice

Many firms benefit from an increasing ability to outsource manufacturing or service functions to lower-cost foreign countries. This trend is referred to in the textbook as a(n) ________ trend.

• A) business
• B) environmental
• C) commerce
• D) statutory
• E) economic

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Definitions:

In-Process Research and Development

Expenditures on research and development activities that are not yet complete, which may be capitalized as an intangible asset.

Indefinite-Lived Asset

An asset that is not anticipated to be consumed or used up and does not have a definable useful life, such as certain trademarks or goodwill.

Amortization

A financial term referring to the gradual reduction of a debt over a period of time by periodic payments of principal and interest.

Acquired Subsidiary

A company that becomes a subsidiary through purchase or takeover by another company.