budgeting Capital budgeting is the planning process used to determine whether an organization's long term investments such as new machinery, replacement machinery, new plants, new products, and research development projects are worth the funding of cash through the firm's capitalization structure (debt, equity or retained earnings). Planning the eventual returns on investments in machinery, real estate and new technology are all examples of capital budgeting. Management must allocate the firm's
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Case 12-9 Rough Waters Ahead - IFRS 1. Cruise Ship belongs to the assets that apply to IAS 36 Impairment rule IAS 36-2 states the Impairment of Assets rule shall be applied in accounting for the impairment of all assets, other than: a) Inventories b) Assets arising from construction contracts c) Deferred tax assets d) Assets arising from employee benefits e) Financial assets that are within the
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Chapter 01 - Financial Statements and Business Decisions Chapter 01 Financial Statements and Business Decisions ANSWERS TO QUESTIONS 1. Accounting is a system that collects and processes (analyzes, measures, and records) financial information about an organization and reports that information to decision makers. 2. Financial accounting involves preparation of the four basic financial statements and related disclosures for external decision makers. Managerial accounting involves the preparation
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| |Sole Proprietorship |It is easily and inexpensively formed. |Difficult to obtain the necessary capital | | |It is subject to few Government rules and |needed for expansion and growth. | | |regulations. |Due to unlimited personal liability for the | |
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degree of exposure to negative events and their probable consequences. Project risk is characterized by three factors: risk event, risk probability and the amount at stake. The risk measurement in the field of the real investments based on predicted cash flow is
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substantial time. Once the company received their receipt they record the EAs as intangible assets with a cost basis of zero, in accordance with The Federal Energy Regulatory Commission (FERC). FERC is accounting guidance for EAs so companies understand rules and regulations associated with the allowance. Governing bodies generally issue rights to help control or reduce the emission of pollutants and greenhouse gases. They also allow entities to emit a specified level of pollutants. EAs individually have
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Standards Board (IASB) developed standard IAS 18, which defines the accounting treatment for revenue arising from certain types of transactions and events. According to IAS 18, “revenue is recognized when it is probable that future economic benefits will flow in the entity and these benefits can be measured reliably.” The development of IAS 18 began with an Exposure Draft E20 in 1981. IASB formally issued standard IAS 18 in December of 1982, but the effective date wasn’t until January 1, 1984. In order
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Program Department of Business Administration National Ping Tung University of Science and Technology Student ID: Name: Nguyen Minh Hue (Victoria) 1. d 2. a 3. a Feedback: [pic] In which: Co – Initial Invesment C - Cash Flow r - Discount Rate T - Time => [pic][pic] = - $59,000 + $22,272.7273 + $20,247.9339 + $21,412.4718 = $4,933.13 4. a 5. d Feedback: CFo = $810,000 + $1,200,000 = $2,010,000 6. e 7. d 8. c Feedback: Opportunity cost = $190
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value of cash flows that occur at different points in time, a series of present values of cash flows should not be summed to determine the value of a capital budgeting project. [A] True [B] False [3] A basic rule in capital budgeting is that if a project's NPV exceeds its IRR, then the project should be accepted. [A] True [B] False [4] The internal rate of return is that discount rate that equates the present value of the cash outflows (or costs) with the present value of the cash inflows
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INTRODUCTION 1.1 1.2 1.3 1.4 DEFINITION OF TECHNOLOGY ROLE OF TECHNOLOGY OPEN INNOVATION STRATEGIC ALLIANCES 3 3 3 3 4 2.0 VALUATION OF TECHNOLOGY 5 3.0 VALUATION METHODS 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8 TWENTY-FIVE PERCENT (25%) RULE INCOME TECHNIQUE MARKET APPROACH COST METHOD RELIEF FROM ROYALTY TECHNOLOGY FACTOR APPROACH CAPITALIZATION APPROACH REAL OPTIONS METHOD 5 6 6 7 7 9 10 11 12 4.0 RISKS FACTORS AFFERCTING VALUATION OF TECHNOLOGY/ IP 4.1 4.2 INTERNAL FACTORS
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