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Mock Exam 2 Capital Lease Problem
Number 64 on Mock Exam 2. Anyone have this handy and can share how to approach? It was so frustrating because I knew kind of how to do it but didn’t have enough time to finish it.
This is the answer.
If all development costs had been expensed then net income would be reduced by the amount spent, and increased by the amortization of the previously capitalized amounts: 225 25 + 10 = 210 million. ROA = 210 / 1,875 = 11.2%. CFO would be lower by the amount spent on development 290 25 = 265 million. Note: The amortization of previous development costs is a noncash expense so does not affect cash flow.
Thanks in advance. |
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发表于 2013-4-17 19:17
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