Concord Company owns a trade name that was purchased in an acquisition of McClellan Company. The trade
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Question:
Concord Company owns a trade name that was purchased in an acquisition of McClellan Company. The trade name has a book value of $ but according to GAAP, it is assessed for impairment on an annual basis. To perform this impairment test, Concord must estimate the fair value of the trade name. It has developed the following cash flow estimates related to the trade name based on internal information. Each cash flow estimate reflects Concords estimate of annual cash flows over the next years. The trade name is assumed to have no salvage value after the years. Assume the cash flows occur at the end of each year.
Cash Flow Estimate
Probability Assessment
$
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a What is the estimated fair value of the trade name? Concord determines that the appropriate discount rate for this estimation is
Related Book For
Intermediate Accounting Volume 1
ISBN: 978-1119496496
12th Canadian edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Irene M. Wiecek, Bruce J. McConomy
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