The Branching Out of Financial Conglomerates into Several Product Lines

question 69

Multiple Choice

The branching out of financial conglomerates into several product lines that reduces the dependence of the financial conglomerate on any single product line is known as

• A)risk-reduction.
• B)diversification.
• C)economies of scope.
• D)risk-abatement.

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Definitions:

Ending Retained Earnings

This is the total amount of net income left over for a company after it has paid out dividends to its shareholders, shown at the end of a financial period.

Net Income

The earnings a company has left after subtracting all costs, taxes, and expenses from its overall revenue.

Adjusting Entry

A journal entry made at the end of an accounting period to record revenue or expenses in the period they occur rather than when cash is received or paid.

Unearned Subscription Revenue

Refers to the money received for services or products that have not yet been delivered or performed, often recognized as a liability on the balance sheet.