Which of the following items is NOT a relevant cash inflow or cash outflow when using the net present value method? (Ignore income taxes.)
A) acquisition cost of new equipment at time zero
B) future disposal value of a long-term plant asset
C) future operating cash inflows from a long-term plant
D) depreciation expense in future periods

Question

Quizplus · Accepted Answer

Depreciation expense is a non-cash item and therefore not a relevant cash inflow or outflow when calculating net present value.

Which of the Following Items Is NOT a Relevant Cash