Current accounting practice takes the viewpoint of shareholders by reporting the amount of net income available to shareholders after subtracting from revenues all expenses incurred in generating the revenue by claimants (for example, employees, lenders, governments) other than shareholders
Indicate whether the statement is true or false
T
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Using the indirect method, cash flows from operating activities would be increased by which of the following?
a. Gain on sale of investments b. Decrease in accounts receivable c. Decrease in accounts payable d. Increase in prepaid expenses
On Monday, Rod said to Tanya that she could buy his car for $5,000. Tanya said that she'd like a few days to think it over. Rod answered that he would hold the car for her until Friday
When Tanya turned up at Rod's home on Friday, Rod told her he'd sold the car to Lenny on Thursday for $5,250. Now Tanya wants to sue. Will she be successful? A) Yes, because Rodney promised not to sell the car till Friday. B) Yes, because Tanya had conditionally accepted Rodney's offer C) No, because Tanya gave no consideration for the promise to hold the car until Friday. D) No, because the agreement to hold the car until Friday was not put in writing. E) No, because Leroy made a better offer.
In a simple structure where the owner manager makes most of the important decisions, extensive rules and regulations are used to maintain order.
Answer the following statement true (T) or false (F)
Which of the following statements is CORRECT?
A. To implement the corporate valuation model, we discount projected free cash flows at the weighted average cost of capital. B. To implement the corporate valuation model, we discount net operating profit after taxes (NOPAT) at the weighted average cost of capital. C. To implement the corporate valuation model, we discount projected net income at the weighted average cost of capital. D. To implement the corporate valuation model, we discount projected free cash flows at the cost of equity capital. E. The corporate valuation model requires the assumption of a constant growth rate in all years.