The acquisition of used devices is a cash outflow thus it is stood for in a an unfavorable sign while meanwhile sale of invest is cash inflow so the exact same is gift in a optimistic sign




You are watching: Based on the following information, compute cash flows from investing activities under gaap.


Under the purchase accountancy method, A. Goodwill need to be amortized straight-line end the target firm"s approximated life. B. Acqu

thedesigningfairy.com: E. Gained assets are tape-recorded at fair industry value

Explanation: obtained assets are taped at fair industry value under the purchase accounting method. The an approach is provided for merger or mix in i beg your pardon one for sure is taken into consideration to have gained the heritage of the other firm. It allows the acquisition of a company to be made on the balance sheet of the company that repurchase it in ~ a price that shows their fair sector value. The target certain is treated as an investment and also there is no pooling the assets. Supposing price paid for the purchased for sure is an ext than its market value (of the obtained firm"s assets) the difference is recorded as goodwill (a group for intangible legacy that are harder to parse the end individually or measure directly) on the acquirer"s balance sheet.



A company is examining an investment which has an initial invest of $15,000. Expected annual net cash flows over 4 years

thedesigningfairy.com:

$850

Explanation:

Data noted in the question:

Initial investment = $15,000

Expected annual net cash flows over four years, R = $5,000

Return top top the invest = 10% = 0.10

Present worth of one annuity aspect for 10% and 4 periods, PVAF = 3.1699

The current value of $1 element for 10% and also 4 periods = 0.6830

Now,

Net existing value = < R × PVAF > - initial investment

= < $5,000 × 3.1699 > - $ 15,000

= $15,849.50 - $ 15000

= $849.50 ≈ $850



thedesigningfairy.com:

supplies price for respectable = $2811

Explanation:

given data

August 1 gives on hand = $1,025

August purchased = $3,110

August 31 supplies on hand = $1,324

solution

we obtain here supplies cost for August the is express as

supplies expense for respectable = respectable 1 gives on hand + respectable purchased - respectable 31 supplies on hand .............1

put right here value

supplies expense for respectable = $1,025 + $3,110 - $1,324

supplies price for august = $2811



The existing value the growth opportunities (PVGO) is same to: I) the difference between a stock"s price and also its no-growth value

thedesigningfairy.com: I, III and IV

Explanation:

The current value the growth avenues (PVGO) is equal to the difference in between the price that a stock and its no-growth worth per share.

It us additionally equal to zero if the return ~ above equity equals the discount rate and us likewise the net present value of favorable invest opportunities.

The present value the growth opportunities (PVGO) is not equal come the stock price. Therefore, choice I, III and IV room correct.





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Suppose you know that a company’s stock right now sells because that $55 per share and the required return ~ above the stock is 8 percent. Y

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