Week 9 ACCY 111 RJD Lecture 6

It was confirmed yesterday dunedin venues management

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It was confirmed yesterday Dunedin Venues Management Ltd - which runs the stadium - had recorded a $1.9 million loss for the first six months of the 2011-12 financial year. The company is now forecasting a full-year loss of $2.4 million, followed by losses of $1.2 million, $1.1 million and $1 million for the following three years, council information shows
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Investment decisions Investment decisions must be consistent with the strategy and objectives of the enterprise. Investment decisions can be seen to operate on two dimensions: - a ‘vertical’ dimension that “stacks up different investment proposals to compare one against another; and - a ‘horizontal’ dimension that considers each project across the various accounting periods that make up its life cycle. Capital budgeting analyses each project by considering the income or cash flows throughout its lifespan, from the initial investment through to its termination.
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Hubbard’s “Big Breakfast” Before Hubbard's Foods launches a new product it estimates revenues that will be generated by the cereal together with differential costs that will be incurred. Those costs include research and development, working capital requirements for raw materials (ingredients) and finished goods inventories, and any incremental capital equipment that might be required.
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Relevant Costs Relevant costs are only those that vary with the investment decision. Thus all costs already incurred, or to which the organisation is already committed to pay, are irrelevant. Common future costs may also not vary with the decision. Thus, for example, the cost of raw materials may not vary with a decision to either invest in a new manufacturing machine or continue with an existing machine.
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Relevant Costs However, opportunity costs relating to benefits forgone should be taken into account. For example, should a business make a decision that results in the continued use of a machine that it already owns the realisable value of that machine could be an important opportunity cost.
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Relevant costs to be considered initial investment in capital equipment, land or buildings revenue from operations increases in current assets such as accounts receivable, raw materials inventories, finished goods inventories increases in current liabilities such as accounts payable differential taxation effects disposal proceeds
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Why Buy a Bookstore? John Malone, who made a fortune in cable television, is offering US$1 billion ($1.26 billion) for Barnes & Noble - trying to jump into a business so sick that its No 2 competitor, Borders Group, is on life support. The difference is that Malone and his Liberty Media conglomerate aren't betting on the books-and-mortar past, analysts say, but the promise of the electronic future.
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Why Buy a Bookstore?
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