Global Distributors has decided to sell its manufacturing operations and concentrate solely on its global distribution operations. This sale is referred to as a(n):
A) liquidation.
B) divestiture.
C) merger.
D) allocation.
E) restructuring.

Question

Quizplus · Accepted Answer

Divestiture refers to the process of selling off a part of a company's assets, such as a subsidiary or a particular product line. In this scenario, Global Distributors is selling its manufacturing operations while continuing to focus on its distribution operations. Liquidation involves winding down a company's operations and selling off all its assets, while a merger involves combining two companies to form a single entity. Allocation and restructuring are not relevant to this scenario.

Global Distributors Has Decided to Sell Its Manufacturing Operations and Concentrate