Can you please answere all the following true/false statements. Thank you 0.70 4G1 454Gi 7:544GVAKB/spdf-valuation-and-.ssed_compress.pdf - Read-onlyビyUIC StaTETIemL TCoNSIStent witTUe tran.SWERSTATEMENT1. Asset has been defined by the industry as transactionsthat would yield future economic benefits as a result ofpast transactions.2. Brown field investment is the term used to describebusinesses that are starting from scratch.3. Enterprise-wide Risk Management allows the companyto increase performance variability.4. Risk identification is important to allow investors toassess impact of the risk to their investment.5. Brown field investments are easier to evaluate asinformation is already available from prior years6. Book value is the term used to describe the valuederived from the amounts reflected in the financialstatements.7. Borrowings that are contracted to be paid after 24months is classified as current liabilities.8. Equipment is classified as non-current assets.9. To get book value per share, total liabilities is deductedfrom total assets and the resulting figure is divided bytotal authorized shares.10. Book value method is a transparent approach sincevalue can be easily verified by looking at the financialstatements.11. Replacement cost is the cost of similar assets that havethe nearest equivalent value as of the valuation date.12. Replacement value is affected by asset age, size and itscompetitive advantage.13. Insurance companies use replacement value as basis todetermine the appropriate insurance premium to becharged to their clients.14. For real properties, it is more important to look at theage of the asset than its size.15. Replacement value method is superior to book value asit gives an indication of true value of the firm as of thevaluation date.16. Replacement value is an estimate of cost ofreproducing, creating, developing or manufacturing asimilar asset17. If there is no comparable assets found in the market, it ismore appropriate to use reproduction value method.42VALUATION CONCEPTS AND METHODOLOGIESANSWERSTATEMENT18. Reproduction value is used for business ventures thatare using highly specialized equipment in theiroperations.19. Reproduction value is easy to validate despite nothaving comparable assets in the industry.20. Among the approaches, the book value method givesthe most recent approximate of the company value.45 of 218

Answer 1. False Reason: "Assets is a resource which is in control of entity and from which future…

1. Asset has been defined by the industry as transactions that would yield future economic benefits as a result of past transactions. 2. Brown field investment is the term used to describe businesses that are starting from scratch. 3. Enterprise-wide Risk Management allows the company to increase performance variability.

1. Asset has been defined by the industry as transactions that would yield future economic benefits as a result of past transactions. 2. Brown field investment is the term used to describe businesses that are starting from scratch. 3. Enterprise-wide Risk Management allows the company to increase performance variability.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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