Question
Lucke Limited estimated the net present value of future cash flows from specialised plant acquired under a business combination to be $25 000. A replacement
Lucke Limited estimated the net present value of future cash flows from specialised plant acquired under a business combination to be $25 000. A replacement cost for the plant is estimated to be $32 000. The plant has been independently appraised at a value of $30 000. A similar item of plant cost the acquirer $28 000 last year.
What is the value for recognition of the plant under a business combination?
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Managerial Economics
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