Which of the Following Statements About Small-Scale Entry Is True

question 15

Multiple Choice

Which of the following statements about small-scale entry is true?

• A) The commitment associated with a small-scale entry makes it possible for the small-scale entrant to capture first-mover advantages.
• B) Small-scale entry is a way to gather information about a foreign market before deciding whether to enter on a significant scale.
• C) By giving a firm time to collect information, small-scale entry increases the risks associated with a subsequent large-scale entry.
• D) Small-scale entry limits a firm's ability to learn about a foreign market thereby also limiting the firm's exposure to that market.

Distinguish between the balance sheet presentation of accounts receivable and the associated debt instruments.

Understand and apply the principles of notes receivable discounting and their impact on financial statements.

Identify and correct errors in the recording of cash transactions and the preparation of bank reconciliations.

Understand the treatment of noninterest-bearing notes receivable, including the computation of interest revenue and discount amortization.

---

Definitions:

Maturity at Issue

The predetermined date when a financial instrument, such as a bond, will come due and the principal is to be paid back to investors.

Default Risk

The potential risk that an issuer of a bond or other debt security will be unable to make principal and interest payments when due.

Collateral Trust Bond

A type of bond that is secured by a pledge of collateral, typically securities, placed under the trust of a third party.

Securities

Financial instruments representing ownership (stocks), a debt agreement (bonds), or rights to ownership (derivatives) that can be bought and sold in financial markets.