Compared to Diversification That Is Grounded in Intangible Resources, Diversification

question 117

True/False

Compared to diversification that is grounded in intangible resources, diversification based on financial resources only is more visible to competitors and thus more imitable and less likely to create value on a long-term basis.

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Definitions:

Closing Entries

Journal entries made at the end of an accounting period to transfer the balances from temporary accounts to permanent accounts, preparing the books for the next period.

Temporary Accounts

Revenue, expense, and drawing accounts that are closed to the owner’s capital account at the end of the accounting period.

Post-Closing Trial Balance

A listing of all accounts and their balances after the closing entries are made, ensuring debits equal credits.

Expense Account(s)

Accounts used to record expenses in the general ledger, which represent the costs of operating a business that are not directly tied to the production of goods or services.