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2. When comparing MEAs with unequal lives, using the coterminated assumption means that we assume that the economic consequences expected during the MEAS' life spans will recur in succeeding life spans True False

2. When comparing MEAs with unequal lives, using the coterminated assumption means that we assume that the economic consequences expected during the MEAS' life spans will recur in succeeding life spans True False

FINANCIAL ACCOUNTING
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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2. When comparing MEAS with unequal lives, using the coterminated assumption means that we assume that the economic consequences expected during the MEAS' life spans will recur in succeeding life spans True False To use the coterminated assumption, the study period is either indefinitely long or equal to a common multiple of the MEAS useful lives. True False Under the coterminated assumption, when the Useful Life > Study Period, we truncate the alternative at the end of the study period, using an estimated market value. True False With repeatability, we can compute the AW of each alternative over its own useful life and recommend the one having the most economical value. 00 True False Under the coterminated assumption, when the Useful Life > Study Period for cost alternatives, we can O A. Contract or lease the needed job for the remaining years of the study period. OB. Tuncate the alternative at the end of the study period, using an estimated market value. O C. Rinvest the net project value at end of useful life in other opportunities at the MARR at the end of the study period O D. All of the above 3. A company can begin to depreciate a property it owns when the property is delivered to the company. True False
Transcribed Image Text:2. When comparing MEAS with unequal lives, using the coterminated assumption means that we assume that the economic consequences expected during the MEAS' life spans will recur in succeeding life spans True False To use the coterminated assumption, the study period is either indefinitely long or equal to a common multiple of the MEAS useful lives. True False Under the coterminated assumption, when the Useful Life > Study Period, we truncate the alternative at the end of the study period, using an estimated market value. True False With repeatability, we can compute the AW of each alternative over its own useful life and recommend the one having the most economical value. 00 True False Under the coterminated assumption, when the Useful Life > Study Period for cost alternatives, we can O A. Contract or lease the needed job for the remaining years of the study period. OB. Tuncate the alternative at the end of the study period, using an estimated market value. O C. Rinvest the net project value at end of useful life in other opportunities at the MARR at the end of the study period O D. All of the above 3. A company can begin to depreciate a property it owns when the property is delivered to the company. True False
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