Indian Institute of Insurance Surveyors and Loss Assessors Tamil Nadu Chapter ------------------------------------ VALUATION FOR THE PURPOSE OF INSURANCE 1.0. WHY VALUATION FOR THE PURPOSE OF INSURANCE? Valuation is important for insurance while insuring and also while assessing the loss. Even thought the need is on two different headings, the purpose is only one and it is to avoid under insurance. 2.0 What is under Insurance? If the value of the subject matter at the time of risk, is
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analysis, the main consolidation worksheet adjustment entries at acquisition date are the business combination valuation entries, to adjust carrying amounts of the subsidiaries’ assets and liabilities to fair value, and the pre-acquisition entries. In preparing consolidated financial statements in periods subsequent to acquisition date, the consolidation worksheet will contain valuation entries and pre-acquisition entries. However, these entries are not necessarily the same as those used at acquisition
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Chu Ltd were recorded at fair values except for inventory, and plant and machinery. The fair value of inventory was $1,000 greater than its carrying amount. This inventory was all sold to external parties in the year ending 30 June 2009. At acquisition date, Chu Ltd had plant & machinery which had a carrying amount of 15,000 and fair value of 16,000. The original cost of this plant and machinery was $17,000. This plant and machinery, which had a further 5 year life at acquisition date, was sold on
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expense it. It is important to be able to recognize the differences between the valuation, depreciation, amortization and depletion of those costs. (Weygandt, Kimmel & Kieso, 2010). Valuation of an asset is the process of determining the value of an asset. This does not mean that the total cost a company spends to acquire an asset and have it ready for operations is the actual value of it. Instead the valuation of an asset is the fair market value of it, which can be quite different than what
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enterprise so as to obtain from its activities? Select correct option: Control Significant Influence Direct Subsidiary Indirect Subsidiary Question # 3 of 15 ( Start time: 05:52:09 PM ) Total M a r k s: 1 Which one of the following methods for inventory valuation is NOT suitable for homogeneous units? Select correct option: FIFO Method LIFO Method Weighted Average Method Specific Identification Method Question # 4 of 15 ( Start time: 05:53:40 PM ) Total M a r k s: 1 Which of the following meeting is held
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associated with plant assets, natural resources and intangible assets include valuation, depreciation, amortization and depletion. The process of valuation is different from depreciation, amortization and depletion in that it involves of making an estimation of an asset based in the market value. This means that the market value at the time of estimation, will determine what the worth is of an asset. Depreciation is the method utilized when allocating the costs of plant assets. During this
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investments such as new machinery, replacement machinery, new plants, new products, and research development projects are worth pursuing. It is budget for major capital, or investment, expenditures.[1] Many formal methods are used in capital budgeting, including the techniques such as Accounting rate of return Payback period Net present value Profitability index Internal rate of return Modified internal rate of return Equivalent annuity Real options valuation These methods use
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construction of a building / dam / ship, launching of a new product, conducting national elections, state level professional admission process, setting up a new plant A project in business refers to an organized program of activity carried out to meet a definite goal. In business it may be to launch a new product, set up a new plant, increase existing capacities etc. Projects may be ; New projects, Modernisation projects, Expansion projects, Diversification projects, Other miscellaneous projects
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5 RATIOS 5 VALUATION 6 CORPORATE VALUATION MODEL 7 DIVIDEND DISCOUNT MODEL
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CHAPTER 8, QUESTIONS 31 & 32 (P.166) 31. What analytical procedures could be used to examine possible understatement (i.e. completeness; valuation and allocation) of allowance for doubtful debts (ADD)? Compare ADD as % of Accounts Receivable (AR) with previous year/s, industry average Compare write-off of uncollectible accounts as % of AR (AR) with previous year/s Compare ageing of debtors (30, 60, 90 days overdue, etc.) as % of AR with previous year/s Compare Accounts Receivable turnover
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