When Two or More Companies with Unique Resources Are Formed

question 17

Multiple Choice

When two or more companies with unique resources are formed to offer a new service to potential customers to create mutual benefit for these companies,this arrangement is called a(n) :

• A)strategic partnership.
• B)merger.
• C)syndicated service.
• D)field service.
• E)professional association.

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Definitions:

Initial Value Method

An accounting approach where investments are recorded at their purchase cost without subsequent adjustment for market changes.

Consolidated Net Income

The total net income of a parent company and its subsidiaries, after eliminating the effects of intercompany transactions.

Investment Account

An account held at a financial institution that holds securities, stocks, bonds, and other investment assets.

Intangible Asset

Assets that are not physical in nature, including goodwill, software, and licensing agreements, valuable to a company's operations.