Which of the Following Is an Advantage Inherent in the Use

question 30

Multiple Choice

Which of the following is an advantage inherent in the use of licensing?

• A) The foreign country gains employment.
• B) There is an exemption from domestic trade regulations.
• C) There is an increase in potential profit gains.
• D) The licensee retains control of its product.
• E) The licensee is protected from creating a potential competitor.

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Definitions:

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or within the normal operating cycle of the business, whichever is longer.

Allowance for Doubtful Accounts

A contra-asset account that represents the amount of accounts receivable a company does not expect to collect.

Accounts Receivable

The money owed to a business by its customers for goods or services that have been delivered or sold but not yet paid for.

Allowance Method

An accounting technique used to account for bad debts, estimating uncollectible accounts as an expense to the income statement and reducing accounts receivable on the balance sheet.