Lake incorporated purchased all of the outstanding stock of huron company paying $950,000 cash. lake assumed all of the liabilities of huron. book values and fair values of acquired assets and liabilities were: book value fair valuecurrent assets (net) $130,000 $125,000property, plant, equip. (net) 600,000 750,000liabilities 150,000 175,000lake would record goodwill of: a. $ 0.b. $ 75,000.c. $445,000.d. $250,000.

Afreezer manufacturer might purchase sheets of steel, wiring, shelving, and so forth, as part of its final product. this is an example of what sub-classification of business market?

Problem 9-5. net present value and taxes [lo 1, 2] penguin productions is evaluating a film project. the president of penguin estimates that the film will cost $20,000,000 to produce. in its first year, the film is expected to generate $16,500,000 in net revenue, after which the film will be released to video. video is expected to generate $10,000,000 in net revenue in its first year, $2,500,000 in its second year, and $1,000,000 in its third year. for tax purposes, amortization of the cost of the film will be $12,000,000 in year 1 and $8,000,000 in year 2. the company’s tax rate is 35 percent, and the company requires a 12 percent rate of return on its films. required what is the net present value of the film project? to simplify, assume that all outlays to produce the film occur at time 0. should the company produce the film?

When used-car dealers signal the quality of a used car with a warranty, a. buyers believe the signal because the cost of a false signal is high b. it is not rational to believe the signal because some used-car dealers are crooked c. the demand for lemons is eliminated d. the price of a lemon rises above the price of a good used car because warranty costs on lemons are greater than warranty costs on good used cars