What is residual value? Support your answer with an example

Q: What is the carryover ratio? What parameters of the base does its value depend on?

A: Carryover Ratio The purpose of measuring the carryover ratio  is to determine the ratio which are…

Q: Define the term cutoff values?

A: Cut-off values for diagnosis or screening examinations that have constant outcomes (estimated on a…

Q: What will be the Effective Cost of Refinancing?

A: The term refinancing is related to mortgage refinancing, is a system that assists mortgage holders…

Q: a. What is the IRR of cach alternative? b. What is the present value of costs of cach alternative?…

A: Capital budgeting is a technique that is used widely by companies to evaluate projects to make the…

Q: What reinvestment rate assumptions are built into the NPV, IRR, and MIRR methods? Givean explanation…

A: It is a method under capital budgeting which includes the calculation of net present value of the…

Q: Define the term Unrealized gain.

A: Investment: The act of allocating money to buy a monetary asset in order to generate wealth in the…

Q: What are value drivers?

A: Answer: The basic determinants of the cash flows of a project or primary factors in project…

Q: In a replacement analysis, why are the previous costs irrelevant?

A: Replacement Analysis is a capital budgeting method that determines whether existing assets need to…

Q: What is the initial cost of setting up the "stop-loss"  strategy?

A: The Stop-loss strategy is very useful which helps the investors to protect in the market, as the…

Q: An analysis of what happens to the estimate of net present value when only one input variable is…

A: Net Present Value: It is the present worth of future cash flows and the initial cost of the project.…

Q: Understand and apply the lower-of-cost-or-net realizable value rule.

A:

Q: What alternative approaches can be used to estimate variable consideration?

A: The alternative approaches that can be used to estimate variable consideration are: Expected value…

Q: How can we determine the operating margin?

A: Operating margin refers to percentage of net operating income over the sales of the company.

Q: Explain Present Value?

A: Present value is the current value of a future sum of money or value. Present value is useful to get…

Q: Describe how to estimate variable consideration.

A: Revenue: It is the income generated by the business over their regular business operations.

Q: What are the Basic Concepts and Terminology of Replacement-Analysis?a

A: Assets: Assets are those items that provide value for money and future economic benefit for an…

Q: Explain the concept of a present-value analysis.

A: Present value (PV) is discounted value of future cash flows to be received at a particular rate of…

Q: Why opportunity cost is measured and relate with the evaluation of alternative, can it be an…

A: Cost or expenditure is the total amount spent by an individual, group and company to make a finished…

Q: Describe the Internal-Rate-of-Return Criterion?

A: Internal rate of return (IRR) is defined as the rate of discount at which the NPV of human capital…

Q: What is the purpose of using the high-low method?

A: High-low method: In the high-low method, the semi variable-cost approximation is calculated by using…

Q: Draw a figure to explain Elements of required return - establishing a MARR?

A: The figure is represented as below: Note: Values assumed

Q: Describe the fundamentals of Replacement-Analysis?

A: Replacement analysis is the process where it is determined whether it would be beneficial to replace…

Q: What is the reinvestment rate assumption when using MIRR?

A: Modified Internal Rate of Return: This method is used to rank investments or projects for an…

Q: How to estimate the Residual Value?

A: Residual value means value of fixed asset left after the use of fixed assets. Residual value also…

Q: What does the intrinsic value formula look like? Please explain the components of the formula.

A: Intrinsic value or the real value is the calculated value or anticipated value of a company’s stock…

Q: What is the definition of “actuarial present value”?

A: Accumulated Benefit Obligation: It is an inexact rate of a company's pension plan liability towards…

Q: Describe the Replacement Analysis using the Opportunity-Cost Approach?

A: The company always considers the replacement projects when the old machinery or plant in the project…

Q: What is the meaning of valuation?

A: Valuation simply refers to the process of ascertainment of the worth of any thing, it can be worth…

Q: Beside the dollar cost, what other costs should you consider when comparing alternative solutions to…

A: There could be lot of factors which are to be considered while comparing alternative solutions to a…

Q: What is the difference between positive and negative predictive value?

A: Positive predictive value is the probability that subjects with a positive screening test truly have…

Q: What is net present value (NPV) method?

A: Capital budgeting can be defined as the decision making process employed by businesses wherein, a…

Q: Explain Replacement-Analysis Fundamentals?

A: Replacement-analysis fundamentalUnder this, the decision regarding the replacement of obsolete as…

Q: Define residual value.

A: Depreciation: Depreciation refers to the reduction in the monetary value of a fixed asset due to its…

Q: benefit

A: Introduction: Incremental Benefit – Cost Analysis: It is the method which helps to determine amount…

Q: what is a provable intrinsic value? can you give a example

A: Intrinsic value of a stock is its fundamental value. This is calculated by taking in to…

Q: example of lower of cost or net realizable value and explain

A: The concept of lower of cost or net realizable value says that the amount of inventory should be…

Q: Elements of required return - establish a MARR? Explain how/

A: Introduction: A capital investment to be appealing should have a return which goes beyond the…

Q: Is it possible to fully eliminate non-value added activities? If yes, how? If no, why?

A: Value can simply be defined as something which the customer is willing to pay or receive. Non Value…

Q: Distinguish between Contribution Margin and Break-Even Volume?

A: Contribution margin:   This is the price of a product less all the associated variable cost that…