Author Question: A tobacco company agrees to pay a state 1 billion a year over the next ten years to settle the ... (Read 43 times)

Tazate · **on:** Jul 5, 2018

A tobacco company agrees to pay a state 1 billion a year over the next ten years to settle the state's claim that the tobacco had harmed the health of its citizens.

The state sells the future revenue stream to a consortium of banks for the present value of the 10 million, and deposits the cash in its General Fund. How should the financial condition analyst view this financial arrangement?
a. the analyst should ignore it, provided the state has classified the revenues as an extraordinary item in its operating statement
b. the analyst should ignore it because the present value of the future revenue stream is equivalent to the revenue stream itself
c. the analyst should assess the impact of the revenue as a one-shot item that balanced the current year's budget, but that might leave a gap in future year budgets
d. the analyst should assess the impact of arrangement on the auditor's report, the notes to the financial statements, and Management's Discussion and Analysis.

Question 2

In a(n) ___________________ ___________ database model, records are organized in a pyramid structure.
Fill in the blank(s) with correct word