Explain risk and gain sharing with the help of an example
What will be an ideal response?
Student answers may vary.
Risk and gain sharing can offset price reductions that customers request. Suppose Medline, a hospital supplier, signs an agreement with Highland Park Hospital promising $350,000 in savings over the first 18 months in exchange for getting a tenfold increase in the hospital's share of supplies. If Medline achieves less than this promised savings, it will make up the difference. If Medline achieves substantially more than promised, it participates in the extra savings.
You might also like to view...
The ability to send e-mails from within PL/SQL code has been simplified with the introduction of the DBMS_ALERT package.
Answer the following statement true (T) or false (F)
________ is the process by which enterprising individuals initiate, manage, and assume the risks and rewards associated with a business.
A. A partnership B. An incubator C. A start-up D. Joint venture E. Entrepreneurship
What did the GM internal memo estimate the cost of the exploding gas tanks would be to GM?
a. $2.40 per car b. The memo did not do that analysis because it did not put a value on human life c. GM had learned from the Ford Pinto case and did not have such a memo d. $200,000 per car
Under what conditions will a partner recognize a gain in a liquidating distribution?
A. When a partnership distributes money, hot assets, and other property and the amount of the distribution is less than the partner's outside basis. B. When a partnership distributes money, hot assets, and other property and the amount of the distribution exceeds the partner's outside basis. C. When a partnership distributes only money and the amount of the distribution is less than the partner's outside basis. D. When a partnership distributes only money and the amount of the distribution exceeds the partner's outside basis.