What are the reasons that cause a firm to construct fixed assets for its own use?

Q: Who should authorize disposal of fixed assets?

A: Disposal of Fixed Asset: Disposal of fixed asset is a process of selling off the asset whose…

Q: What happens if economic engineers invest too much in assets?

A: Economic engineers always combine finance with engineering and develop various models to deal with…

Q: How to compare different assets in investment selection process? What are the quantitative…

A: One of the important decisions that financial managers are supposed to take is that they have to…

Q: Do you think a company like Target would have significant research anddevelopment costs or…

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Q: Explain how current assets’ investment policies affect the firm’s risk and return trade-offs.

A: Current assets for a company are all those assets that are readily available for the conversion into…

Q: How can we determine the Acquisition of Fixed Assets?

A: Fixed Assets- Fixed Assets are those assets which are acquired for the purpose of: production or…

Q: In addition to satisfying a need that outsiders cannot meet within the desired time, what other…

A: ANSWER   Company may develop plant assets internally as the cost might be lower for construction of…

Q: How does the company can benefit indirectly by leasing assets rather than buying?

A: Company can take benefit of leasing assets rather than buying assets due to many reasons: Leasing…

Q: Can the selection of a depreciation method affect a company’s asset replacement policy (i.e., the…

A: 1. Depreciation Expenses - Depreciation Expenses are the expense incurred on the wear and tear of…

Q: How can we reduce investment risks by asset diversification?

A: Answer: Diversification is nothing but the strategy that reduces the risk by allocating assets to…

Q: What are the unique risks of land development projects from the developer’s and lender’s points of…

A: The risks of land development projects from developer’s point of view: Planning risk: The ability…

Q: Define non operating investment assets.

A: A non-operating investment asset is a class of assets that are not essential to the ongoing…

Q: what are some pros and cons of holding high level of current assets in relation to sale?

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Q: How is the asset based valuation important in the business?

A: In case of mergers and acquisitions:: In the event that two companies are merging, or if a company…

Q: Question Content Area According to GAAP, interest cost incurred to finance construction of an asset…

A: 1) The period of capitalization should end when the asset is ready for intended use. 2)when the…

Q: How long will an asset be useful to the company?

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Q: Under U.S. GAAP, what alternatives do companies have to value their property, plant,and equipment?

A: According to US GAAP, the Property,plant & equipment are to be recognized and measured only…

Q: What is the capitalized cost of the new machinery?

A: Capitalized costs are incurred when an organization purchases any fixed asset such as building,…

Q: One financial accounting issue encountered when a companyconstructs its own plant is whether the…

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Q: Why must the Engineers consider the effective use of fixed capital assets?

A: Engineer indulge in numerous process of decision-making such as manufacturing, financing, and…

Q: What is the DuPont method of analysis and how does it break down return on assets

A: Given : This question tells about the DuPont method of analysis and how does it break down return on…

Q: How does the materials requisition help safeguard a company’s assets?

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Q: What are the economic benefits of leasing vs ownership of assets?

A: MEANING:- Leasing of Assets - The leasing of assets refers when the owner gives the right to use…

Q: What is the role of financial intermediaries in asset transformation? Briefly explain along with the…

A: Financial intermediaries are the entities involved in mobilizing the funds between two parties, one…

Q: How long does an asset remain the most useful to the company? What do statutes and accounting rules…

A: Financial Accounting:   It refers to the process of recording the financial transactions of the…

Q: How does a firm value an asset?

A: Assets means resources of the business that the business owns. It may be tangible assets or…

Q: How much is the initial cost of the asset?

A: Purchase price  Less: Trade discount/Rebate  Add: Import Duties  Add: Non refundable taxes  Add:…

Q: Do the fixed assets lose their value even though they continue to function and contribute to the…

A: Meaning of Fixed Assets Fixed assets are those assets which are used in the business with the…

Q: Describe the cost of fixed assets.

A: Fixed Assets - Fixed Assets are assets that are non-current in nature. These assets are purchased…

Q: How can we Evaluate Business and Engineering Assets?

A: Evaluation of Business and engineering asset can be done with the help of the below analysis:…

Q: What is the Characterization of the Land Development Business?

A: Land development : Land development is method of  transformation or developing the land into a…

Q: What costs are included in determining the total cost of an asset? Why would a company include more…

A: Asset refers to the resources used by the company in order to run operations effectively and…

Q: What negative consequences result when fixed asset records include assets that the firm no longer…

A: Assets that were purchased for long-term use in the organization is called fixed assets, they also…

Q: Why should the total costs of the machine be viewed as an asset and allocated against the future…

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Q: Should a company allow the owners to use the resources as they see fit?

A: solution : Should a company allow the owners to use the resources as they see fit?…

Q: Is capital maintenance-oriented towards proprietary theory or entity theory?

A: Given: The relation of capital maintenance.

Q: Explain how the DuPont system of analysis breaks down return on assets?

A: As per DU point analysis, ROA(retrun on asets)=(Net Income/Sales)*(Sales/Average Assets)

Q: According to GAAP, interest cost incurred to finance construction of an asset must be capitalized in…

A: As per US GAAP on Capitalised Interest, interest costs that are directly attributable to the…

Q: What are the advantages of using the Dupont System to analyze the Return on Assets

A: Dupont analysis is one that helps the firm to analyze the fundamental performance of the firm. It is…

Q: ) How could rates of technological change affect a company’s decision about whether to buy or lease…

A: Rate of technology plays a crucial role in the decisions made by companies. If the technology is…

Q: Property plant and equipment are considered what type of asset?

A: basically classification of asset is done based on the nature of the asset .there are two types of…

Q: a need that outsiders cannot meet within the desired time, what other reasons might cause a firm to…

A: Other reasons that might cause a firm to construct fixed assets for its own use includes: To…