Johnson Limited Estimated the Net Present Value of Future Cash

question 5

Multiple Choice

Johnson Limited estimated the net present value of future cash flows from specialised Plant acquired under a business combination to be $30 000.A replacement cost for the Plant is estimated to be $33 000.The Plant has been independently appraised at a value of $31 000.A similar item of Plant cost the acquirer $29 000 last year.What is the fair value for recognition of the Plant under a business combination?

• A)$29 000
• B)$30 000
• C)$33 000
• D)$31 000.

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Definitions:

Publicly Owned Treatment Works

Facilities owned by a state or municipality that are designed to treat municipal sewage or industrial wastewater.

Ocean Dumping

The disposal of waste materials directly into the ocean, often regulated to prevent environmental harm.

Marine Protection, Research, and Sanctuaries Act

United States legislation focused on the preservation and management of marine environments, often referred to as the Ocean Dumping Act.

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U.S. federal law aimed at reducing pollution and protecting the quality of the nation's waterways.