Answer:
The stock market tends to value diversified companies at less than their break-up value.
Explanation:
Conglomerate discount is only applicable to large, highly diversified business entities and it basically arises as a result of business analysts having difficulty finding an appropriate way to value group of businesses with complex financial statements.
Simply stated, the expression "conglomerate discount" means that the stock market tends to value diversified companies at less than their break-up value.
Hence, when a vast array of businesses aren't performing optimally as the overall conglomerate or there are issues with respect to its core values and financial statements, business analyst may have to apply the conglomerate discount concept.
In order to calculate the conglomerate discount, business experts add up various estimations of the intrinsic values associated with the respective subsidiary firms in a conglomerate and lastly, the market capitalization of the conglomerate is subtracted from that sum. Intrinsic value refers to a measure of the underlying value of a firm and its cash inflow.
Also, it's worthy of note that the sum of the various estimations is typically greater than the conglomerate stock values.
Hi! Consumer sovereignty Means the economic power exercised by the preferences of consumer In a free market.
Answer:
Supplier or creditor ac Dr .... to Cash ac Cr
Explanation:
- Company records purchases using the gross method
Purchase ac Dr .. to Creditor ac Cr
{ Asset / Expense increase debit , liability increase credit }
- Paid supplier the amount owed from the August 1 purchase.
Supplier or creditor ac Dr .... to Cash ac Cr
{ Liability decrease debit , Asset decrease credit }
<span>Money, political resources, and infrastructure are not considered economic factors of production.
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