Greenwich Plc Is Considering Adding Two New Products at a Subsidiary

question 32

Multiple Choice

Greenwich plc is considering adding two new products at a subsidiary to improve its overall competitiveness. The new products are enthusiastically supported by the managers responsible and an immediate decision is required. It is normal for the managers to calculate the net present value (NPV) for the projects before it is accepted or rejected.
Details of the proposals

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Calculate the Net Present Value of the cash flows for Project A

• A)£13,200.
• B)£25,200.
• C)£28,942.
• D)£18,942.

Determine the appropriate accounting treatment for acquired company intangibles and R&D expenditures.

Understand the process and importance of computing depreciation for assets.

Recognize the various methods of depreciation and the factors affecting their selection.

Calculate depreciation using different methods such as double-declining-balance, straight-line, and units-of-production.

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Definitions:

Electronically

Through the use of electronic devices or systems, especially over digital networks.

Positive

An attribute of numbers greater than zero or situations that are beneficial or desirable.

Collection Float

The time period between when a payment is made by a customer and when the funds are actually available in the company’s bank account.