In Buying a Business,if Tangible Assets Include Machinery That Has

question 73

Multiple Choice

In buying a business,if tangible assets include machinery that has no,or very little value,the buyer may wish to consider

• A) that the cost of replacement might be exorbitant.
• B) that may be the reason the current owner wants to sell.
• C) both of the above.
• D) none of the above.

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Definitions:

Beginning Inventory

The value of a company's stock of goods at the start of an accounting period, serving as a baseline for inventory management.

Net Income

The total profit of a company after all expenses and taxes have been subtracted from its total revenue.

Period End Assets

The total value of all assets owned by a company at the end of a given financial reporting period.

Retail Method

An inventory valuation method used in retail, estimating the ending inventory value by applying a cost-to-retail percentage to the sales at retail.