At the Beginning of the Year, You Have an Outstanding

question 89

Multiple Choice

At the beginning of the year, you have an outstanding short-term loan of $10 which was used to cover your cash needs for the previous year. During the current year, you expect to pay $2 interest
And have an annual net cash inflow of - $10 (negative) , excluding the interest payment. What is your
Anticipated loan balance at year end?

• A) $0
• B) $2
• C) $12
• D) $18
• E) $22

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Definitions:

Noncontrolling Interest

Noncontrolling interest is a financial stake in a subsidiary held by investors other than the parent company, reflecting their share of the subsidiary's net assets and earnings.

Goodwill

The excess value paid for a company over its net asset value, reflecting intangible assets such as brand reputation, customer relationships, and intellectual property.

Acquisition-Date

The specific date on which one entity gains control over another, which is crucial for recognizing and measuring the assets acquired, liabilities assumed, and any noncontrolling interest.

Control Premium

An additional amount that a buyer is willing to pay over the current market price to acquire a controlling interest in a company.