Author Question: A corporate manager decides to build a new store on a lot owned by the corporation that could be ... (Read 101 times)

LCritchfi

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  • Posts: 519
A corporate manager decides to build a new store on a lot owned by the corporation that could be
  sold to a local developer for 250,000. The lot was purchased for 50,000 twenty years ago. When
  determining the value of the new store project,
 
  A) the opportunity cost of the lot is 250,000 and should be included in calculating the value of
  the project.
  B) the cost of the lot for valuation purposes is 50,000 because land does not depreciate.
  C) the incremental cash flow should be the 50,000 original cost less accumulated amortization.
  D) the cost of the lot is zero since the corporation already owns it.

Question 2

What information does a firm's income statement provide to the viewing public?
 
  A) an itemization of all of a firm's assets and liabilities for a defined period of time
  B) a report of investments made and their cost for a specific period of time
  C) a report of revenues and expenses for a defined period of time
  D) a complete listing of all of a firm's cash receipts and cash expenditures for a defined period of
  time


bob

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Answer to Question 1

A

Answer to Question 2

C



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