A Medium-Sized Hardware Manufacturer Wants to Become Deeply Involved in Exporting

question 90

Multiple Choice

A medium-sized hardware manufacturer wants to become deeply involved in exporting, but it does not yet wish to actually manufacture any of its products overseas.The company wants to maintain control over its sales while gaining experience in foreign markets.Which option would be best for this company?

• A) licensing its products for sale in foreign countries
• B) selling its products outright to an export/import merchant
• C) establishing its own sales offices in foreign countries
• D) developing totally owned facilities in a foreign market
• E) hiring an export/import agent to assist with foreign sales

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Definitions:

Operating Activities

These activities involve the primary, day-to-day operations of a business, such as selling products, providing services, and incurring operating costs.

Financial Statements

Reports that provide an overview of a company's financial condition, including balance sheet, income statement, and cash flow statement.

Indirect Method

A reporting approach used in cash flow statements where net income is adjusted by changes in non-cash accounts to determine cash flow from operating activities.

Net Cash Flow

The difference between a company's cash inflows and outflows within a defined period.