FASB Financial Accounting Concepts on Using Estimated Future Cash Flow

question 69

Multiple Choice

FASB financial accounting concepts on using estimated future cash flow information in accounting measurements to value various assets and liabilities identified each of the following elements except

• A) an estimate of the future cash flows and the timing of those cash flows.
• B) an increase in the interest for any expected risk.
• C) estimates about variations in the amount or timing of those cash flows.
• D) that estimated cash flows should reflect a single most likely minimum or maximum possible amount, rather than a range of possible cash flows.

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Definitions:

Required Rate Of Return

The minimum return an investor expects to achieve by investing in a specific asset, considering the risk associated with the investment.

Dividends Per Share

The amount of dividends paid out to shareholders per share of a company's stock.

Growth In Dividends

The pace at which dividend distributions to shareholders by a company grow over a period.

Required Rate Of Return

This is the minimum return that investors expect or demand for an investment to be considered worthwhile.