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tigry1 [53]
3 years ago
14

Selected information from Large Corporation's accounting records and financial statements for 2013 is as follows ($ in millions)

: Cash paid to acquire a patent $48 Treasury stock purchased for cash 45 Proceeds from sale of land and buildings 75 Gain from the sale of land and buildings 46 Investment revenue received 15 Cash paid to acquire office equipment 70 Large prepares its financial statements in accordance with IFRS. In its statement of cash flows, Large most likely reports net cash outflows from investing activities of:
a. $28 million.

b.$48 million.

c.$118 million.

d.$58 million.
Business
1 answer:
lozanna [386]3 years ago
6 0

Answer:

In its statement of cash flows, Large most likely reports net cash outflows from investing activities of a. $28 million.

Explanation:

Open an extract of the section of the Cash flow Statement IAS 7 of IFRS and determine the Cash flow from Investing Activities.

Consider only cash flows that relate to purchase and sale of assets.Assets are economic resources controlled by the entity as a result of past events for which economic benefits are expected to flow into the entity.

                                                                             ($ in millions)

<u>Cash flow from Investing Activities</u>

Cash paid to acquire a patent                                    (48)

Proceeds from sale of land and buildings                  75

Cash paid to acquire office equipment                      (70)

Investment revenue received                                      15

Net cash outflows from investing activities               (28)

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Answer:

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Explanation:

It will capitalize the entire research adn development cost as well as the fees and registration cost as are part of the incurred cost needed to obtain the patent

Therefore: 204,000 + 41,000 = 245,000

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Julius asks Rachel if she would like to sell her boat. Rachel privately has no interest in selling her boat, and believes that J
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2 years ago
You are considering a project and are concerned about the reliability of the cash flow forecasts. To reduce any potentially harm
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Suppose that an investor with a 10-year investment horizon is considering purchasing a 20-year 8% coupon bond selling for $900.
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Answer:

8.67%

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N (No of coupons paid) = 10*2 = 20

Rate (Semi-annual reinvestment rate) = 7%/2 = 3.5%

Future value of reinvested coupons = FV(PMT, N, Rate)

Future value of reinvested coupons = FV(40, 20, 3.5%)

Future value of reinvested coupons = $1,131.19

FV = 1,000

PMT (Semi-annual coupons) = 40

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Rate (Semi-annual YTM) = 9%/2 = 4.5%

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Total Annual Return = [(Total amount after 10 years / Amount invested)^(1/holding period)] -1

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Total Annual Return = 0.08665561792

Total Annual Return = 8.67%

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