Which of the Following Reasons Can Make a Diversification Strategy

question 10

Multiple Choice

Which of the following reasons can make a diversification strategy an unwise course of action for a company to pursue?

• A)Changing industry conditions
• B)Changing firm-specific conditions
• C)Diversification for the wrong reasons
• D)Increasing bureaucratic costs of diversification
• E)All of these choices

Appreciate the significance of budgeted vs. actual performance analysis in managerial accounting.

Calculate sales price and volume variances to assess performance in non-manufacturing contexts.

Recognize the impact of volume changes on unit fixed and variable costs.

Understand the accounting treatment for insignificant cost variances.

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Definitions:

Contract

refers to a legally enforceable agreement between two or more parties that creates obligations to do or not do specific things.

Intention

A person's plan or purpose to carry out an exact action, often considered in legal contexts to determine the nature of an agreement or responsibility.

Unconditional Acceptance

An agreement to the terms of an offer without any modifications or conditions.

Original Offer

The initial proposal or terms presented by one party to another during negotiations for a contract or agreement.