Do you see any reason that the IRR should still be in use today since.docx

•Als DOCX, PDF herunterladen•

0 gefällt mir•3 views

Do you see any reason that the IRR should still be in use today since the NPV is more accurate? Please write out one to two paragraphs explain why. Thank you Solution The Internal Rate of Return(IRR) is usually the rate of return that a project earns. IRR is the discount rate that equates the aggregate present value of the net cash inflows with the aggregate present value of cash outflows of a project. In other words, it is that rate which gives the project NPV of zero. The IRR method is a theoretically correct technique to evaluate capital expenditure decisions. It has the advantages which are offerred by the NPV criterion such as a) it considers the time value of money and b) it takes into account total cash inflows and outflows. In addition, it is easier to understand. People understand the concept of IRR much more readily than they understand the concept of NPV. For example , business people are more likely to understand the concept of the IRR when it is linked to the concept of k, the cost of capital. Also, a required rate of return is a prerequisite for computing the NPV. The discount rate used in NPV calculations is a result of a number of assumptions which may or may not be realistic. On the other hand, a discount rate is not a prerequisite for computing the IRR. It does not use the concept of the required rate of return or cost of capital.It itself provides a rate of return which is indicative of the profitability of the proposal. Finally, the IRR is consistent with the overall objective of maximizing stockholder wealth. .

Bildung

Weitere ähnliche Inhalte

Ähnlich wie Do you see any reason that the IRR should still be in use today since.docx

Npv profile

Capital budget

Ch 08

Capital budgeting

PART 1 Net present value represents the difference between the present value of cash inflows and outflows (Gallant, 2023). A positive NPV means that an investment is worth investing in, NPV of zero would indicate that the investment would be balanced between the cash inflows and outflows, if the NPV is negative than the investment would not be worth investing in. The internal rate of return or IRR is used by companies to estimate how much profit would the investment generate over time. NPV and IRR can help a company make smarter decisions and reduce risk when it comes to investing. What are things/scenarios that would greatly affect the NPV & IRR? and why? Please be very detailed. Thanks PART 2 Net present value (NPV) is the difference between the present value of cash inflows and the present value of cash outflows over a period of time. NPV is used in Capital budget and investment planning to analyze the profitability of a projected investment or project. It is essential to understand the different risk and factors that are taken into countability when it comes to the investments being done. Starting off with how differential risk that can be incorporated into NVP analysis. The following would be done by increasing the discount rate for those different projects that hold a higher risk. This tool will reduce the present value of cash flows, which means that it increases uncertainty and risk. Now lets refer to IRR analysis "The internal rate of return (IRR) is a metric used in financial analysis to estimate the profitability of potential investments. IRR is a discount rate that makes the NVP of all cash flows equal to zero in a discounted cash flow analysis. Leading to apply that the riskier the project, the higher IRR less than riskier ones. What other things are essential to reduce the risk on investments? What steps must be taking to lower the risk or what things must be considered prior looking into the NVP & IRR? Please be very detailed. Thanks.

PART 1Net present value represents the difference between the pres.pdf

climatecontrolsv

Capital Budgeting : capital budgeting decision

Ravindra Nath Shukla

PART 1 Net present value represents the difference between the present value of cash inflows and outflows (Gallant, 2023). A positive NPV means that an investment is worth investing in, NPV of zero would indicate that the investment would be balanced between the cash inflows and outflows, if the NPV is negative than the investment would not be worth investing in. The internal rate of return or IRR is used by companies to estimate how much profit would the investment generate over time. NPV and IRR can help a company make smarter decisions and reduce risk when it comes to investing. What are things/scenarios that would greatly affect the NPV & IRR? and why? PART 2 Net present value (NPV) is the difference between the present value of cash inflows and the present value of cash outflows over a period of time. NPV is used in Capital budget and investment planning to analyze the profitability of a projected investment or project. It is essential to understand the different risk and factors that are taken into countability when it comes to the investments being done. Starting off with how differential risk that can be incorporated into NVP analysis. The following would be done by increasing the discount rate for those different projects that hold a higher risk. This tool will reduce the present value of cash flows, which means that it increases uncertainty and risk. Now lets refer to IRR analysis "The internal rate of return (IRR) is a metric used in financial analysis to estimate the profitability of potential investments. IRR is a discount rate that makes the NVP of all cash flows equal to zero in a discounted cash flow analysis. Leading to apply that the riskier the project, the higher IRR less than riskier ones. What other things are essential to reduce the risk on investments? What steps must be taking to lower the risk or what things must be considered prior looking into the NVP & IRR?.

PART 1Net present value represents the difference between the pres.pdf

rmwaterlife

Discounted measures

Huma Ilyas

WORKING CAPITAL PRACTICES WORKING CAPITAL PRACTICES Tanelle Peppers Business 650 Ashford University WORKING CAPITAL PRACTICESCapital budgeting are the planning methods used by organza tons to decide which of its long Term investments are worth pursuing. Since most organizations are at the moment restructuring Their working capital practices, in order to discover untapped cash sources .The main methods Used for capital budgeting are Internal rate of return, Net present value, Real options analysis, Payback period, Profitability index, and Equivalent annuity. Net Present Value It’s used in estimating each potential project's worth using a discounted cash flow valuation. The valuation requires estimating the size and timing of all the incremental cash flows from the project. The NPV is greatly affected by the discount rate, so selecting the proper rate–sometimes called the hurdle rate–is critical to making the right decision. This should reflect the riskiness of the investment, typically measured by the volatility of cash flows, and must take into account the financing mix. Managers may use models, such as the CAPM or the APT, to estimate a discount rate appropriate for each particular project, and use the weighted average cost of capital (WACC) to reflect the financing mix selected. A common practice in choosing a discount rate for a project is to apply a WACC that applies to the entire firm, but a higher discount rate may be more appropriate when a project's risk is higher than the risk of the firm as a whole. Internal Rate of Return The internal rate of return (IRR) is defined as the discount rate that gives a net present value (NPV) of zero. It is a commonly used measure of investment efficiency. The IRR method will result in the same decision as the NPV method for non-mutually exclusive projects in an unconstrained environment, in the usual cases where a negative cash flow occurs at the start of the project, followed by all positive cash flows. Nevertheless, for mutually exclusive projects, the decision rule of taking the project with the highest IRR, which is often used, may select a project with a lower NPV. One shortcoming of the IRR method is that it is commonly misunderstood to convey the actual annual profitability of an investment. Accordingly, a measure called "Modified Internal Rate of Return (MIRR)" is often used. Payback Period Payback period in capital budgeting refers to the period of time required for the return on an investment to "repay" the sum of the original investment. Payback period intuitively measures how long something takes to "pay for itself.” All else being equal, shorter payback periods are preferable to longer payback periods. The payback period is considered a method of analysis with serious limitations and qualifications for its use, because it does not account for the time value of money, risk, financing, or other important considerations, such as the opportunity cost. Profitability Index Prof.

WORKING CAPITAL PRACTICESWORKING CAPITAL PRACTICES.docx

ericbrooks84875

Capital Budgeting Decision

Ashish Khera

Capital budgeting decisions

Aswin prakash i , Xantus Technologies

The investment decisions of a firm are generally known as the capital budgeting, or capital expenditure decisions. The firm’s investment decisions would generally include expansion, acquisition, modernisation and replacement of the long-term assets. Sale of a division or business (divestment) is also as an investment decision. Decisions like the change in the methods of sales distribution, or an advertisement campaign or a research and development programme have long-term implications for the firm’s expenditures and benefits, and therefore, they should also be evaluated as investment decisions.

CAPITAL BUDGETING DECISIONS.ppt

Dr.K.Sivaperumal

Sesi 6 cap budgeting

reran999

Creating a PowerPoint presentation for capital budgeting involves outlining the process of evaluating and selecting long-term investment projects. Here's a suggested description for each slide: Slide 1: Title Slide Title: Capital Budgeting: Investing in Future Growth Subtitle: An Overview of Strategic Investment Decision-Making Your Name/Company Logo Slide 2: Introduction to Capital Budgeting Definition of Capital Budgeting Importance of Strategic Investment Decisions Objective: Optimal Allocation of Capital Resources Slide 3: Types of Capital Budgeting Decisions Overview of Capital Budgeting Decision Types: Expansion Projects Replacement Projects New Product Launches Cost Reduction Initiatives Slide 4: Capital Budgeting Process Sequential Steps in Capital Budgeting: Identification of Investment Opportunities Estimation of Cash Flows Evaluation of Cash Flows Selection of Projects Implementation and Monitoring

Capital Budgeting PPT Of MBA Semister 2

VikasDighe6

THAI MUSIC-Mariestela e

Mj Rufin

Capital Bugeting - Discounted Cash Flow Methods.pptx

VadivelM9

NPV v/s IRR

Rämäwätär Täwäniýä

Shashikant Mishra

Project Management 07

Tathagat Varma

Please reflect on the role of NPV and payback period in evaluating investment alternatives. How does this effect us as investors? Solution When evaluating a project or long term investment of company, it is important to reach right decisions based on the capital budgeting methods. Net Present Value (NPV) For a project with one investment outlay, made initially, the net present value (NPV) is the present value of the future after-tax cash flows minus the investment outlay. Because the NPV is the amount by which the investor\'s wealth increases as a result of the investment, the decision rule for the NPV is as follows: Payback Period The payback period is the number of years required to recover the original investment in a project. The payback is based on cash flows. For example, if you invest $10 million in a project, how long will it be until you recover the full original investment? Payback period methods is simple and easy to understand, however, it has many drawbacks. First, it is a measure of payback and not a measure of profitability. By itself the payback period would be a dangerous criterion for evaluating capital projects. The payback period may also be used as an indicator of project liquidity. A project with a two- year payback may be more liquid than another project with a longer payback. Because it is not economically sound, the payback period has no decision rule like that of the NPV or IRR. If the payback period is being used (perhaps as a measure of liquidity), analysts should also use an NPV or IRR to ensure that their decisions also reflect the profitability of the projects being considered..

Please reflect on the role of NPV and payback period in evaluating i.pdf

ajayinfomatics

Ähnlich wie Do you see any reason that the IRR should still be in use today since.docx (20)

Npv profile

Capital budget

Ch 08

Capital budgeting

PART 1Net present value represents the difference between the pres.pdf

Capital Budgeting : capital budgeting decision

PART 1Net present value represents the difference between the pres.pdf

Discounted measures

WORKING CAPITAL PRACTICESWORKING CAPITAL PRACTICES.docx

Capital Budgeting Decision

Capital budgeting decisions

CAPITAL BUDGETING DECISIONS.ppt

Sesi 6 cap budgeting

Capital Budgeting PPT Of MBA Semister 2

THAI MUSIC-Mariestela e

Capital Bugeting - Discounted Cash Flow Methods.pptx

NPV v/s IRR

Project Management 07

Please reflect on the role of NPV and payback period in evaluating i.pdf

Mehr von wviola

Alice intends to send a secure message to Bob. (1) What are the threats that Alice should be concerned about in sending messages to Bob? (2) What information does Alice need if symmetric key encryption is used? (3) What is needed if asymmetric key encryption is used? (4) Is encryption alone sufficient to defend against these threats? Solution Alice intends to send a secure message to Bob. (1). The threats that Alice should be concerned about in sending messages to Bob are,,, a.Eavesdropping b.Traffic analysis c.cryptanalysis (2).Â Â Alice needs the information if symmetric key encryption used is... * Symmetric-key cryptography is a mechanism by which the same key is used for both encrypting and decrypting. (3). if asymmetric key encryption is used the needed thing is... * asymmetric key encryption is used Two keys are a public and a private one. The public one is available for everyone, but the private one is known only by the owner. (4). No, Encryption alone is not sufficient to defend against these threats. .

Alice intends to send a secure message to Bob- (1) What are the threat.docx

wviola

Add a function prototype for the function sumNum. # include using namespace sted; int main (void) { float val; float amount; int n; cin >> val >> n; sumNum (amount, val, n); cout Solution Prototype of function : In function concept prototype declaration is necessary in order to provide information to the compiler about function, about return type, parameter list and function name etc. Program : # include<iostream .h > using namespace std; float sumNum(float,float, int); /* prototype for the function sumNum it accept the sum value which is a float value and parameter list mentioned, i.e. float,float, int */ int main (void) //main function float amount; int n; cin>>val>>n; // Accept the value sumNum(amount,val,n); // Calling function cout<<amount<<end1; } void sumNum(float &sum, float x,int n); // Called function { int i; sum=0.0; //Intilise the sum value to zero. for(i=1;i<=n;i++) { sum=sum+i*x; // calculate the sum } return sum; // Here we return sum value } .

Add a function prototype for the function sumNum- # include using nam.docx

wviola

Add a new check on the emp table to make sure that any new employee inserted has sex either \'M\' or \'F\'. Create a new table called highway, with columns: empid and salary, and insert only those employees into this new table whose salary is greater than $40000. Write an SQL query that would return the department name and the maximum salary of that department (of only Male employees, i.e. Female employees should not be included). Using the IN operator, write a SQL statement that would return the first name, last names and the department names of those in \'MEN CLOTHING\' or \'WOMAN CLOTHING Display only those department names, and average salaries (rounded to the nearest dollar) of only those departments whose average salaries are greater than $33000. Create a view called ernp_manager_deptname with the employee last name (upper cased), manager name (lowercased) and the department name (lowercased) of each employee. Grant only view and change rights to the columns fname, lname and ssn to everyone. Create an INDEX for the emp table called indSSN on the column ssn and salary. Drop the index and revoke the grant Assume that there exists another column in the emp table called datejoined (which contains the date when the employee joined the company). Write a SQL query that gives the first name, last name and the number of days employed in the company. Solution 1. ALTER TABLE emp ADD CHECK (sex=\'M\' OR sex=\'F\') 2.create table highpay(empid int,salary int) insert into highpay select empid,salary from emp where salary>40000 3.select d.deptname,max(salary) from emp as e,dept as d where e.deptno=d.deptno and e.sex=\'M\' group by d.deptname 4.select e.fname,e.lname,d.deptname from emp as e,dept as d where e.deptno=d.deptno and deptname IN (\'MEN CLOTHING\',\'WOMAN CLOTHING\') .

Add a new check on the emp table to make sure that any new employee in.docx

wviola

Adding elements to an Array. Given the following simple List class that uses an array implementation, write code to add an element at the specified index. Solution //----------------------------------------------------------------- // Adds the specified Comparable element to the list, //----------------------------------------------------------------- public void add (int index,T element) { If(index < 0 || index > rear) throw new IndexOutOfBoundsException(); if (rear == list.length) expandCapacity( ); Comparable<T> temp = (Comparable<T>)element; int scan = 0; while (scan < rear && temp.compareTo(list[scan]) > 0) scan++; for (int scan2=rear; scan2 > scan; scan2--) list[scan2] = list[scan2-1] list[index] = element;//add element in speciefied index rear++; } .

Adding elements to an Array- Given the following simple List class tha.docx

wviola

Ad by DealsFactor | Close Menlo Company Contribution Income statment Solution 1. Break Even Point: In Units: BEP = Fixed Cost / Contribution Per Unit Fixed Cost = $148,800 Contribution Per Unit = Sales - Variable Cost Contribution Per Unit = 40- 28 = $12 BEP in Units = 148,800 / 12 = 12,400 Units BEP in $ = BEP in units x Selling Price Per Unit BEP in $ = 12,400 x 40 = $496,000 2. Contribution Margin at Break Even: Contribution Margin at Break Even is equal to Total Fixed Cost = $148,800 .

Ad by DealsFactor - Close Menlo Company Contribution Income.docx

wviola

Action Center activation Administrative Tools Aero applets Computer Computer Management context menu Control Panel desktop Device Manager extension Flip 3D Folders list interface Jump List library logon screen Microsoft Management Console (MMC) My Computer My Documents My Network Places Navigation pane Network notification area Performance Performance Monitor pinned application Quick Launch toolbar Recycle Bin Reliability and Performance Monitor service Start button SystemRoot System Tools system tray taskbar transparency Userâ€™s Files Welcome screen Windows Explorer Windows Sidebar x64 x86 Which key term fits in the sentence? Jill accidentally deleted a critical file. Winona the tech assures her that the file is no doubt in the __________________ and not lost forever. Solution Recyclebin Recyclebin has all the files accidentaly just deleted from the system. .

Action Center activation Administrative Tools Aero applets Computer Co (2).docx

wviola

Acids Bases Taste Taste pH greater than pH less tharn Acids effect indicators (Color) 1. Acids tum blue litmus to 2. Acids turn Cabbage Extract to Bases effect indicators: 1. Bases turn red litmus to blue 2. Bases turn Cabbage Extract to_ Acids react with bases producing aand water Proton(Proton -H hydrogen Proton acceptors (Protons H hydrogen ion) ion) on concentration in Increase solution sotiion concentration in Increase solution Acids react with carbonates to produce a salt, Bases feel slippery water and CO2 Acids react with active metals to produce Write Two Examples of acids Write Two Examples of bases Solution Acid - Taste -sour Ph less than 7. acids turn blue litmus to red. Acid turn cabbiageextract to red. Acid + Base ------> salt + water Acid - proton donor increase H+ ion concentration in solution. Acid react with metal to produce Hydrogen gas. Acid example -HCl, HF, H2SO4 Bases - Bitter in taste. pH greater than 7. Bases turn cabbiageextract to the Green color. Increase OH- concentration. Two example of bases -NaOH, KOH .

Acids Bases Taste Taste pH greater than pH less tharn Acids effect ind.docx

wviola

Action Center activation Administrative Tools Aero applets Computer Computer Management context menu Control Panel desktop Device Manager extension Flip 3D Folders list interface Jump List library logon screen Microsoft Management Console (MMC) My Computer My Documents My Network Places Navigation pane Network notification area Performance Performance Monitor pinned application Quick Launch toolbar Recycle Bin Reliability and Performance Monitor service Start button SystemRoot System Tools system tray taskbar transparency Userâ€™s Files Welcome screen Windows Explorer Windows Sidebar x64 x86 Which term fits in the sentence? A(n) __________________ links folders and displays them together for quick and easy access to your files. Solution Library links folders and displays them together for quick and easy access to files .

Action Center activation Administrative Tools Aero applets Computer Co.docx

wviola

Action Center activation Administrative Tools Aero applets Computer Computer Management context menu Control Panel desktop Device Manager extension Flip 3D Folders list interface Jump List library logon screen Microsoft Management Console (MMC) My Computer My Documents My Network Places Navigation pane Network notification area Performance Performance Monitor pinned application Quick Launch toolbar Recycle Bin Reliability and Performance Monitor service Start button SystemRoot System Tools system tray taskbar transparency Userâ€™s Files Welcome screen Windows Explorer Windows Sidebar x64 x86 Which key term fits in the sentence? The __________________ in Windows XP offers a great spot for accessing favorite programs without resorting to the Start menu. Solution Answer : The \" JUMP LIST \" in Windows XP offers a great spot for accessing favourite programs without resorting to the Start Menu. .

Action Center activation Administrative Tools Aero applets Computer Co (1).docx

wviola

Acid lonization Constants (K,) for Some Monoprotic Weak Acids at 25 ec s Formula Structural Formula lonization Reaction HCIO2 Chlorous acid 1.96 Ho (aq)CO2 (aq) Go(g) 1.110 Nitrous acicd HNO2 HNO2(aq) H20(,) H0 (aq)NO2 (aq) + 4.6 10 3.34 Hydrofluoric acid HF HF(ag) H200 H-F 3.5 104 3.46 H0 (aq)F(aq) Formic acid ????? HCHO2(ag)H200) - 3,74 H-0-C-H Ho (ag)CHO2 (aq) CHO g)1.8 101 ?? ? HC7H502 CH HC,H02(a)H20U) H-0-C-C Benzoic acid 6.510 4.19 H0 (a) C,MG02 (a0) HC,H30(aq) H20U) Acetic acid 1.8 x 10 4.74 H-0-C-CH H30 (aq) CH02 (aq) HOO(aq) H20(,) H30 (aq) = + 2.9 x 10 7.54 Hypochlorous acid HCIO CIO (aq) HCN(ag) H20U) 9.31 HCN Ho (aq)CN CN (ag)4.9 10 1 acid HC@H,0(aq) H200)- 1010 9.89 CH 1.3 x Phenol HCgHs0 ??-? H0(aq)CaHO (aq) KkK. (See tha dieeuesinn at the end of Section 15 Solution 1) the given Ka = 3.16 x 10^-5 pKa = -log Ka = -log (3.16 x 10^-5) pKa = 4.50 the corresponding acid = Acetic acid . acetic acid pKa = 4.74 this is very close to the given pKa value. .

Acid lonization Constants (K-) for Some Monoprotic Weak Acids at 25 ec.docx

wviola

AC 556 Accounting for Governmental & Nonprofit Entities Chapter 6Solut.docx

wviola

Accounting Which of the following is true of a corporation- OA- The st.docx

wviola

AC 556 Accounting for Governmental & Nonprofit Entities Chapter 7Solut.docx

wviola

advantages and disadvantages of using centralized network management versus distributed network management explain Solution centralized network management : 1) Advantage: i) Centralized management is simpler to develop and maintain. ii) Single location to view events and alerts. iii) Single place to access network management applications and information. iv) Security is easier to maintain. 2) Disadvantages: i) It requires a huge amounts of information to travel back to a centralized network operations center (NOC). ii) Single is system is not redundant or fault tolerant. iii) As networks elements are added, may be difficult or expensive to scale system to handle load. iii) Having to query all devices from a single location. Distributed network management: 1) Advantages: i) Distribution of network management task. ii) Distribution of network monitoring throughout the network. iii) Not dependent on single system. 2) Disadvantages: i) Information gathering is more difficult and time consuming. ii) The list of managed devices managed by each client needs to be predetermined and manually configured. .

advantages and disadvantages of using centralized network management v.docx

wviola

Advantages & Disadvantages of Server Applications in 150+ words Solution Advantages: 1. Updates: Updates and patches can be pushed easily on all client machine. 2. Centralized Control and Configuration: Any changes made to the system are centralized like db error or system settings. 3. Better than installing copy on every client machine. Integrity, resources and access of the data are controlled by dedicated servers. It makes difficult for an unauthorized program or person to damage the system. 4. Scalibility: We can manage and control number of clients and severs separately. 5. Back up and Recovery: As all the data is stored at one place on sever its easy to back up and recove data. 6. Accessibility: We can access the server from various platfroms. 7. Security: Servers have better control access and resources to ensure that only authorized clients can access or manipulate data and server-updates are administered effectively. 8. Performance: clients server model improves the performance of large applications in heavy usage environments by restricting the network traffic to performance tier traffic. 9. Easy maintenance: distribute the roles and responsibilities to several standalone computers, you can replace, repair, upgrade, or even move a server, while customers will not be affected by that change (or minimally affect). This independence of the changes is also known as encapsulation. Disadvantages: 1. Server Overloading: When there are a lot of simultaneous client request than server get severely overloaded. Traffic becomes congested. 2. We may need increased bandwidth for the reasom mentioned above so that our server can handle more number of requests simultaneously. .

Advantages & Disadvantages of Server Applications in 150+ wordsSolutio.docx

wviola

Does any one have a paper on human resource practices in countries besides the U.S? Solution The paper first presents various approaches to the management and recruitment of employees in subsidiaries that the company has established in different countries. Then, she turns her attention to the basic functions of international human resource management, among them recruitment and selection of new employees, development and training of employees, assessment of work efficiency, as well as remuneration of employees. As the expatriates are often given special attention by their work organizations, she concludes the paper with the description of the additional challanges occurring in the management of these employees. 1. INTRODUCTION In Slovenia, with a population of only two million, we have a lot of organizations doing business successfully, not only in the domestic but also in the international environment. Lek, one of our two pharmaceutical companies; Fructal, which produces juices from various kinds of fruit; SCT, the road construction company and Mura, which produces men .

Does any one have a paper on human resource practices in countries bes.docx

wviola

Do you think Facebook should operate in China even if it means complying with the restrictions there? Solution Yes, Facebook can be allowed to operate in China, by complying with the restrictions that have been suggested by the government. Facebook is a social medium that has its presence all over the world. But a few countries have still posed a ban on the website since it has lead to occurances of cyber crimes and social crimes. The best part is that it is not the only cause. China being a most populous country, it will not be able to spend a lot of work force on solving the cyber crimes or social crimes that might arise out of the intervention of social media. Hence they have a stringent policy of allowing these websites as to put it simple, it will add on the existing problems of the society. The country also feels that it will divert the attention of the student community towards socializing, Asian countries are rich for their cultural values and ethical behaviours which they have a fear of loosing if they allow the social media to venture into their country. So it is always better to stick to the local government and comply the restrictions is order to atleast venture first, and conquer later. .

Do you think Facebook should operate in China even if it means complyi.docx

wviola

Do you think contingent gains should be disclosed in the financial statements? Defend your position. Solution Contingent gain or loss is a concept where the firm will suffer loss or will make gain only on hapening of certain contingency or event in future. Suppose a company has claimed some money for extra work. Disput arises regarding the inclution of those work in the contract escalation clause. The dispute has been referred to court. The company will gain, if the judgement of court goes in their favor. It is a contingent gain which will materialize only when judgement is favorable. It is not justified to include them in the financial statement as the gain has not been made. Also it is not certain whether such gain will at all be achieved or not. From convertesim point of view any income or gain which is not sure to be earned should not be included. However it is the responsibility of company to disclose all facts in its report.So that it can project true and fair view of state of affairs of the concern. Hence there should be disclosure in the financial statement in detail about the contingent happenings. .

Do you think contingent gains should be disclosed in the financial sta (1).docx

wviola

Do you think contingent gains should be disclosed in the financial sta.docx

wviola

Do you believe the “double taxation” of earnings which occurs at the corporate ownership structure is justified? Solution Double taxation affects C corporations. Double taxation refers to situations when business profits are taxed at both the corporate and personal levels. First profits are taxed at corporate level before paying any amount to shareholders at the rate applicable to corporate. Then dividends are subject to tax at individuals tax rate Double taxation forces corporations to use debt financing, and encourage them to do retained earnings rather than distriubuting to shareholders in the form of dividends. Since the corporations are put at a disadvantage due to double taxation. This is not justified at all since shareholders are considered owners and their income is taxed twice. Dividend should be made exempt and corporates should not have top pay tax on dividends. thus we can say that double taxation affects business and investment decisions which is not justified at all. .

Do you believe the double taxation of earnings which occurs at the cor.docx

wviola

Mehr von wviola (20)