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discuss the effect of disposal of asset in company's balance sheet as well as consequences of...

discuss the effect of disposal of asset in company's balance sheet as well as consequences of relying on revenue from overseas operation in probable effect on income statement.how the activities undertaken by companies reflect stock price

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Disposal of Asset: When an asset is disposed off, the fixed assets or the Net, Plant property and equipment (PPE) on the balance sheet decreases. So this decrease has to be balanced by the increase in Cash on hand in the current assets. The share price is expected to increase as investors expect that this excess cash from disposal of the asset will be gives as dividends to investors

Revenue from overseas operation: The revenue from overseas operations will be subject to exchange rate risks. If the exchange rate moves in favor of the company, then the revenues will be inflated leading to higher net profit and a higher stock price. If the exchange rate moves against the company, then the revenues will be deflated leading to lower net profit and a lower stock price.

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