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taurus [48]
2 years ago
8

How physical assets valuation and development and research pose risk.​

Business
1 answer:
Alex Ar [27]2 years ago
7 0

Answer:

The differences between US GAAP and IFRS pose an extra cost because international corporations must prepare two separate accounting statements. But besides that, other potential risks include paying higher taxes than what the companies should pay int their home countries and the uncertainty generated by changing rules.

Not only do current tax rates affect potential investments, e.g. currently companies in the US pay relatively low corporate taxes (Tax Cuts and Jobs Act of 2017) but these benefits end on 2025. But also different methods for valuating physical assets and R&D costs can represent higher than expected taxes. E.g. depending on a company's needs, it may be beneficial to expense all R&D costs right away, or maybe it would be better to capitalize some of them after technical feasibility is achieved (IFRS).

The main advantage of having uniform rules (e.g. UCC) is that all the companies know exactly what to expect and how to act. Certainty decreases risk, and less risk reduces costs.

Explanation:

In the US, the vast majority of firms use US GAAP as their accounting method, but around the world the IFRS method is used.

Physical asset valuation is the process of determining the value of your physical assets including P, P & E, and also inventories.

  • When valuing inventories IFRS uses FIFO, while US GAAP allows FIFO, LIFO or weighted average costing methods. US GAAP also values inventory at lesser of cost or market value, while IFRS values inventory at lesser of cost or net realizable value.
  • US GAAP uses the cost method to determine the historic cost of an asset, while IFRS uses basically the same method but does not include all the costs of location of the assets (e.g. cost of removing or clearing a facility).
  • US GAAP recognizes non-monetary exchanges while IFRS doesn't.
  • IFRS also allows the cost of asset to be revalued, which can result in unrealized gains or losses. The US GAAP only considers historic costs.
  • There are also other minor differences regarding depreciation, disposals and impairment rules.

Research and development must be expensed right away under US GAAP, while IFRS basically requires the same, it allows some capitalization of development expenditures if certain criteria is met (technical feasibility is achieved).

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A researcher was interested in the relationship between the number of texts sent in a day and the number of e-mails sent in a da
mixas84 [53]

Answer:

A. 14

Explanation:

the researcher claims that the width of the interval would have been smaller if the sample had been different, and in this case different refers to larger. The original sample included only 15 people, so in order to increase the data sample, you must include more than 15 people. That is why 14 doesn't make sense.

3 0
3 years ago
Folio Company estimates total manufacturing overhead costs to be $80,000 for the year and estimates direct labor hours to be 4,0
gregori [183]

Answer:

Allocated Overhead= $76,000

Explanation:

Giving the following information:

Estimated overhead for the period= $80,000

Estimated direct labor hours= 4,000 for the same period

Actual direct labor hours for the period are 3,800.

<u>First, we need to calculate the estimated overhead rate. Then, we can determine the amount of overhead allocated to work in process for the period.</u>

To calculate the estimated manufacturing overhead rate we need to use the following formula:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= 80,000/4,000= $20 per direct labor hour

Now, we can allocate overhead:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated MOH= 20*3,800= $76,000

8 0
3 years ago
beta of 0.88 and an expected dividend growth rate of 4.00% per year. The T-bill rate is 4.00%, and the T-bond rate is 5.25%. The
gregori [183]

Answer:

RA=11.6%

Explanation:

RA=Rf+(Rm-Rf)Ba

RA=?

Rf=5.25%

Rm=12.5%

Ba=.88

RA=5.25%+(12.5%-5.25%).88

6 0
3 years ago
The Town of McHenry has $13,000,000 in general obligation bonds outstanding and maintains a single debt service fund for all deb
VLD [36.1K]

Answer:

Dr Cash $13,000,000

Cr Other financing source- refunding of existing debt $13,000,000

Dr Other financing uses - refunding of existing debts $13,000,000

Cr Cash $13,000,000

Explanation:

Preparation of the Journal entries to record the transaction on the books of the debt service fund.

Based on the information given we were told that the Town of McHenry has the amount of $13,000,000 in general obligation bonds outstanding in which On July 1, 2017, a current refunding of the amount of $13,000,000 took place which means that the Journal entries to Record the transaction on the books of the service debt fund will be :

Dr Cash $13,000,000

Cr Other financing source- refunding of existing debt $13,000,000

Dr Other financing uses - refunding of existing debts $13,000,000

Cr Cash $13,000,000

4 0
3 years ago
A june sales forecast projects that 6,000 units are going to be sold at a price of $10.50 per unit. the desired ending inventory
ohaa [14]
Purchases = Sales units + Closing inventory - Beginning Inventory
                  = 6,000 + (1,000 * 115%) - 1,000
                  = 6,150 units
7 0
3 years ago
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