Holding other things constant, a firm's "discretionary financing needed" (the additional funds required in order to finance the firm) would be reduced if the firm experienced an increase in which of the following?
A) The dividend pay-out ratio
B) The profit margin
C) The accounts receivable average collection period
D) The expected growth rate in sales
Answer: B
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IN-PROCESS R&D may be acquired in an acquisition. How is it treated under U.S. GAAP and IFRS?
a. It is capitalized under U.S. GAAP and expensed under IFRS. b. It is capitalized under both U.S. GAAP and IFRS. c. It is expensed under both U.S. GAAP and IFRS. d. It is expensed under U.S. GAAP and capitalized under IFRS.
On appraisals of older apartment buildings, a major problem in the cost method is:
a. that construction methods and styles have changed. b. that construction materials have changed. c. the determination of accrued depreciation. d. the determination of rental revenue generated by the property.