What Are the Arguments for and Against "Divestment Planning" to Protect

question 28

Essay

What are the arguments for and against "divestment planning" to protect assets and qualify for Medicaid coverage of nursing home costs? In your opinion, is divestment planning an ethical practice? Why, or why not?

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Definitions:

Materiality

A company-specific aspect of relevance. An item is material when its size makes it likely to influence the decision of an investor or creditor.

Activity Level

An indicator of the volume of business activity or operations in a specific period, often used in costing and budgeting to measure performance.

Fixed Costs

Costs that remain constant in total regardless of changes in the level of activity within a relevant range.

Static Budget

A budget that is based on fixed assumptions and does not change with variations in business activity levels.