Research Indicates That the Uncertainty Surrounding New Ventures to Be

question 67

Multiple Choice

Research indicates that the uncertainty surrounding new ventures to be so great that it usually took a company ______________ years after launching the venture to reasonably estimate the venture's future profitability.

• A) one to two
• B) two to three
• C) ten
• D) seven to eight
• E) four to five

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Definitions:

Net Income

The income a business retains after subtracting all costs and taxes from its gross revenue.

Equity Method

An accounting technique used by companies to record their investments in other companies, reflecting the financial performance proportionally in their own accounts.

Buildings Account

An account that records the costs associated with a company's buildings, including purchase price, construction costs, and improvements.

Unamortized Patent

The portion of a patent's cost that has not yet been expensed against earnings over its useful life.