If Two Business Units Generate More Revenue Because They Are

question 146

Multiple Choice

If two business units generate more revenue because they are collectively owned by a single corporate parent, the strategy of common ownership is ________.

• A) synergistic
• B) rare
• C) opportunistic
• D) enhancing

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Definitions:

Book Value

The net value of an asset or liability according to its listing in the company's balance sheet, generally equal to its original cost minus any depreciation, amortization, or impairment costs.

Book Value per Share

The equity of a company divided by the number of outstanding shares, determining the accounting value of a share of stock.

Inventory on Credit

Inventory on credit refers to the purchase of goods that will be sold in the future without paying cash upfront, creating accounts payable for the business.

Acid-Test Ratio

A stringent indicator of a company's liquidity, calculating if it can meet its short-term obligations with its most liquid assets, excluding inventory.