Smart Products Suppose Smart Products Has Three Divisions Which Contribute 40, 35

question 18

Multiple Choice

Smart Products
Suppose Smart Products has three divisions which contribute 40, 35, and 25 percent each to its revenues.
-Now suppose Smart Products acquires a competitor of one of its divisions and the new shares of revenues are 60,25,and 15 percent.Is Smart Products more or less focused?

• A) less focused; the HI increases to 0.445
• B) less focused; the HI decreases to 0.25
• C) more focused; the HI decreases to 0.25
• D) more focused; the HI increases to 0.445

Understand the definition and purpose of the statement of cash flows.

Differentiate between operating, investing, and financing activities.

Identify the classification of cash receipts and payments according to the statement of cash flows.

Recognize the importance of cash equivalents in financial reporting.

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Definitions:

Capital Gain Yield

The appreciation in the price of an investment, expressed as a percentage of the initial investment cost.

Total Rate Of Return

The overall return on an investment, including both capital gains and income, expressed as a percentage of the initial investment.

Capital Gain Yield

The increase in the price of an investment, calculated as the percentage difference between the current price and the purchase price.

Rate Of Total Return

A measure of the overall return on an investment, including both capital gains and income, expressed as a percentage of the initial investment.