Value of assets-future cash flows


Problem: In our real life, the value of assets cannot be estimated perfectly because we can't be certain for the future cash flows that the asset generates and also we can't be certain for the discount rate. Because of the uncertainty for the future cash flows and the discount rate, we cannot complete the balance sheet if we do have the income statement first. Can you explain how the uncertainty is related to earnings quality and how the uncertainty can be reduced?

Solution Preview :

Prepared by a verified Expert
Accounting Basics: Value of assets-future cash flows
Reference No:- TGS01619665

Now Priced at $20 (50% Discount)

Recommended (93%)

Rated (4.5/5)