What Are the Characteristics of a Successful Firm

question 15

Multiple Choice

What are the characteristics of a successful firm?

• A)The firm places appropriate emphasis on profit,is aware of economic and environmental trends outside the company,and measures impact on the community and employees.
• B)The firm values numeric profit and encourage employees to do what is in their power to increase profits.
• C)The firm ensures there are always monthly,quarterly,and annual profit and loss statements as the sole measure of success so that all employees are aware of the success or failure of a period.
• D)The firm allows only top management to make decisions based on profit.

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Definitions:

Transactions and Events

Transactions refer to the economic activities that impact financial status, and events are occurrences that can affect the company's financial position.

Balance Sheet

A financial statement that reports a company's assets, liabilities, and shareholders' equity at a specific point in time.

Percentage of Sales Method

A financial forecasting technique where future values such as budgets or debt levels are estimated based on a specified percentage of sales.

Allowance for Doubtful Accounts

An estimation of the amount of credit sales that are expected to not be collected due to customer defaults.