An example of an event where the book value of property, plant, and equipment may not be recoverable would include
A) a significant change in the way the asset is used.
B) a current period operating loss.
C) a significant decrease in the fair value of the asset.
D) All of these choices are examples where the book value may not be recoverable.
D
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The low cost of a direct sales force acts as an incentive for establishing direct distribution in a new market
Indicate whether the statement is true or false
Inherent risk is typically assessed at a low to moderate level for inventory due to the nature of the asset.
Answer the following statement true (T) or false (F)
Which of the following statements is true of the lawsuits in which minority shareholders complain that they have been unfairly treated by the directors?
A. The business judgment rule cannot be applied to such lawsuits. B. These suits can claim a freeze-out. C. Minority shareholders will always win such suits. D. These suits always involve open corporations.
Wright Corp. is considering the purchase of a new piece of equipment, which would have an initial cost of $1,000,000 and a 5-year life. There is no salvage value for the equipment. The increase in net income each year of the equipment's life would be as follows: Year 1$375,000Year 2$350,000Year 3$285,000Year 4$230,000Year 5$185,000What is the payback period?
A. 2.96 years B. 2.06 years C. 3.51 years D. 1.77 years