Fair values are really for investors and analysts, aren't they? So why would the corporation want...
Fair values are really for investors and analysts, aren't they? So why would the corporation want to know and pay for the fair value of their assets and liabilities? What would investors, analysts or the corporation do with that information?
(Please provide adequate context to the response.)
Homework Answers
Fair market value is not only useful for Investors, analyst but also for the corporation because it provide an idea about the selling price at which both buyer and seller are ready to exchange the financial securities in the market. it is determined on the basis of a fair value at which seller does not lose. it is different from market value because market price fluctuate with short interval while fair value remains constant over the period.
Corporation want to know and pay the fair value of their liabilities because it provides a fair valuation of liabilities and assets, provide a true view of income on disposal of assets and also helps in the time of financial difficulty at which internal construction can be done fairly
Investors and analysts use fair value to know the purchase price of the assets and for valuation of business in case of merger and takeover. Investors use this information for acquiring the financial assets like bonds, shares etc.
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Fair values are really for investors and analysts, aren't they?
So why would the corporation want...
SafeData Corporation has the following account balances and respective fair values on June 30 Book Values...
SafeData Corporation has the following account balances and respective fair values on June 30 Book Values Fair Values Receivables Patented technology Customer relationships In-process research and development Liabilities Common stock Additional paid-in capital Retained earnings deficit, 1/1 Revenues Expenses 109,500 109,500 115,000 115,000 762,000 546,000 (442,000 (442,000) (100,000) (300,000) 734,700 (486,000) 368,800 Privacy First, Inc., obtained all of the outstanding shares of SafeData on June 30 by issuing 20,000 shares of common stock having a $1 par value but a...
SafeData Corporation has the following account balances and respective fair values on June 30: Book Values...
SafeData Corporation has the following account balances and respective fair values on June 30: Book Values Fair Values Receivables $ 110,000 $ 110,000 Patented technology 126,000 126,000 Customer relationships 0 504,000 In-process research and development 0 492,000 Liabilities (520,000 ) (520,000 ) Common stock (100,000 ) Additional paid-in capital (300,000 ) Retained earnings deficit, 1/1 802,400 Revenues (492,000 ) Expenses 373,600 Privacy First, Inc., obtained all of the outstanding shares of SafeData on June 30 by issuing 20,000 shares of...
SafeData Corporation has the following account balances and respective fair values on June 30: Book Values...
SafeData Corporation has the following account balances and respective fair values on June 30: Book Values Fair Values Receivables $ 104,000 $ 104,000 Patented technology 162,000 162,000 Customer relationships 0 732,000 In-process research and development 0 484,000 Liabilities (448,000 ) (448,000 ) Common stock (100,000 ) Additional paid-in capital (300,000 ) Retained earnings deficit, 1/1 686,000 Revenues (420,000 ) Expenses 316,000 Privacy First, Inc., obtained all of the outstanding shares of SafeData on June 30 by issuing 20,000 shares of...
SafeData Corporation has the following account balances and respective fair values on June 30: Book Values...
SafeData Corporation has the following account balances and respective fair values on June 30: Book Values Fair Values Receivables $ 83,500 $ 83,500 Patented technology 149,000 149,000 Customer relationships 0 748,000 In-process research and development 0 590,000 Liabilities (576,000 ) (576,000 ) Common stock (100,000 ) Additional paid-in capital (300,000 ) Retained earnings deficit, 1/1 833,900 Revenues (352,000 ) Expenses 261,600 Privacy First, Inc., obtained all of the outstanding shares of SafeData on June 30 by issuing 20,000 shares of...
SafeData Corporation has the following account balances and respective fair values on June 30: Book Values...
SafeData Corporation has the following account balances and respective fair values on June 30: Book Values Fair Values Receivables $ 86,000 $ 86,000 Patented technology 121,000 121,000 Customer relationships 0 688,000 In-process research and development 0 528,000 Liabilities (476,000 ) (476,000 ) Common stock (100,000 ) Additional paid-in capital (300,000 ) Retained earnings deficit, 1/1 775,800 Revenues (434,000 ) Expenses 327,200 Privacy First, Inc., obtained all of the outstanding shares of SafeData on June 30 by issuing 20,000 shares of...
SafeData Corporation has the following account balances andrespective fair values on June 30:Book Values...
SafeData Corporation has the following account balances and respective fair values on June 30:Book ValuesFair ValuesReceivables$128,500$128,500Patented technology163,000163,000Customer relationships0712,000In-process research and development0626,000Liabilities(532,000)(532,000)Common stock(100,000)Additional paid-in capital(300,000)Retained earnings deficit, 1/1760,100Revenues(498,000)Expenses378,400Privacy First, Inc., obtained all of the outstanding shares of SafeData on June 30 by issuing 20,000 shares of common stock having a $1 par value but a $75 fair value. Privacy First incurred $10,000 in stock issuance costs and paid $75,000 to an investment banking firm for its assistance in arranging the combination....
SafeData Corporation has the following account balances and respective fair values on June 30: Privacy First,...
SafeData Corporation has the following account balances and
respective fair values on June 30:
Privacy First, Inc., obtained all of the outstanding shares of
SafeData on June 30 by issuing 20,000 shares of common stock having
a $1 par value but a $60 fair value. Privacy First incurred $10,000
in stock issuance costs and paid $60,000 to an investment banking
firm for its assistance in arranging the combination. In
negotiating the final terms of the deal, Privacy First also agrees...
SafeData Corporation has the following account balances and respective fair values on June 30 Book Values...
SafeData Corporation has the following account balances and respective fair values on June 30 Book Values Fair Values Receivables Patented technology Customer relationships In-process research and development Liabilities Common stock Additional paid-in capital Retained earnings deficit, 1/1 Revenues Expenses 109,500 109,500 115,000 115,000 762,000 546,000 (442,000 (442,000) (100,000) (300,000) 734,700 (486,000) 368,800 Privacy First, Inc., obtained all of the outstanding shares of SafeData on June 30 by issuing 20,000 shares of common stock having a $1 par value but a...
SafeData Corporation has the following account balances and respective fair values on June 30: Receivables Patented...
SafeData Corporation has the following account balances and respective fair values on June 30: Receivables Patented technology Customer relationships In-process research and development Liabilities Common stock Additional paid-in capital Retained earnings deficit, 1/1 Revenues Expenses Book Values $ 124,500 178,000 0 0 (464,000) (100,000) (300,000) 673, 100 (458,000) 346,400 Fair Values $ 124,500 178,000 714,000 366,000 (464,000) Privacy First, Inc., obtained all of the outstanding shares of SafeData on June 30 by issuing 20,000 shares of common stock having a...
In the coronavirus pandemic, stock analysts have a new job: credit analysis. As the global economy...
In the coronavirus pandemic, stock analysts have a new job: credit analysis. As the global economy grinds to a standstill amid mandatory shutdowns, the survival of many businesses is suddenly in doubt, especially those in vulnerable sectors such as airlines, hotels and restaurants. Instead of asking how fast a company can grow, ever-optimistic equity analysts now have to answer a grimmer question: how long can it last if its revenue vanishes? This focus on cold, hard cash means they have...
SafeData Corporation has the following account balances and respective fair values on June 30 Book Values Fair Values Receivables Patented technology Customer relationships In-process research and development Liabilities Common stock Additional paid-in capital Retained earnings deficit, 1/1 Revenues Expenses 109,500 109,500 115,000 115,000 762,000 546,000 (442,000 (442,000) (100,000) (300,000) 734,700 (486,000) 368,800 Privacy First, Inc., obtained all of the outstanding shares of SafeData on June 30 by issuing 20,000 shares of common stock having a $1 par value but a...
SafeData Corporation has the following account balances and
respective fair values on June 30:
Privacy First, Inc., obtained all of the outstanding shares of
SafeData on June 30 by issuing 20,000 shares of common stock having
a $1 par value but a $60 fair value. Privacy First incurred $10,000
in stock issuance costs and paid $60,000 to an investment banking
firm for its assistance in arranging the combination. In
negotiating the final terms of the deal, Privacy First also agrees...
SafeData Corporation has the following account balances and respective fair values on June 30 Book Values Fair Values Receivables Patented technology Customer relationships In-process research and development Liabilities Common stock Additional paid-in capital Retained earnings deficit, 1/1 Revenues Expenses 109,500 109,500 115,000 115,000 762,000 546,000 (442,000 (442,000) (100,000) (300,000) 734,700 (486,000) 368,800 Privacy First, Inc., obtained all of the outstanding shares of SafeData on June 30 by issuing 20,000 shares of common stock having a $1 par value but a...
SafeData Corporation has the following account balances and respective fair values on June 30: Receivables Patented technology Customer relationships In-process research and development Liabilities Common stock Additional paid-in capital Retained earnings deficit, 1/1 Revenues Expenses Book Values $ 124,500 178,000 0 0 (464,000) (100,000) (300,000) 673, 100 (458,000) 346,400 Fair Values $ 124,500 178,000 714,000 366,000 (464,000) Privacy First, Inc., obtained all of the outstanding shares of SafeData on June 30 by issuing 20,000 shares of common stock having a...
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