On June 10,Year 1,Burton Builders,Inc. ,a publicly traded company,announced that it had been awarded a contract to build a football stadium at a contract price of $500 million.This contract would increase its projected revenues by 20% over the next three years.Which of the following statements is correct with regard to this announcement?
A) The market price of Burton's stock will probably be higher on June 11,Year 1 than on June 10th.
B) Burton's net cash flow from operations will increase by 20% over the next three years.
C) Burton's assets should be increased by $500 million on June 10,Year 1 to recognize this contract.
D) Burton's net income will increase by 20% over the next three years.
Correct Answer:
Verified
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