Brand Extensions Is the Practice of

question 191

Multiple Choice

Brand extensions is the practice of

• A)manufacturing a product under a new name that consumers will view as an entirely new product line.
• B)manufacturing a new product with the same brand name for a new market segment in the same product class.
• C)manufacturing accessory products for the base offering, such as Barbie clothes for Barbie dolls.
• D)licensing another firm to manufacture modified versions of the original product.
• E)applying the current brand name to enter a completely different product class.

---

Definitions:

Prior Period Adjustment

Adjustments made to the financial statements of a prior period to correct errors or implement changes in accounting policy.

Retained Earnings Account

An equity account on the balance sheet that represents the accumulated net earnings not distributed to shareholders in the form of dividends.

Net Income

The final income of a company, achieved by subtracting expenses and taxes from the total revenues.

Income Tax Expense

The expense incurred by individuals or corporations due to taxable income, recognized in financial statements.