Suppose That a Company's Annual Sales Were $1,200,000 in 1999

question 84

Multiple Choice

Suppose that a company's annual sales were $1,200,000 in 1999.The annual growth rate of sales from 1999 to 2000 was 16%,from 2000 to 2001 was -5%,and from 2001 to 2002 was 22%. The geometric mean growth rate of sales over this three-year period is calculated as 10.37%.Use the geometric mean growth rate and determine the forecasted sales for 2004.

• A)1,780,678
• B)1,200,014
• C)1,965,337
• D)1,613,371
• E)1,422,197

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Definitions:

Recognition And Measurement

The principles determining when and how economic events should be recognized in the financial statements and at what amounts they should be recorded.

Additional Business Income Tax

A tax that may be levied on businesses in addition to the standard income tax, based on various criteria such as location or type of business activity.

Partnership

An official business entity operated by two or more individuals who divide management duties and profit sharing.

Business Ownership

Business Ownership refers to the legal possession of a business, which includes the right to control its operations and profit from its activities.