The reason cash flow is used in capital budgeting is because:
A) income is used to purchase new machines.
B) cash outlays need to be evaluated in terms of the present value of the resultant cash inflows.
C) to include the tax shield provided from amortization ignores the cash flow provided by the machine which should be reinvested to replace old worn out machines.
D) cash includes all accounting accruals.
Correct Answer:
Verified
Q1: Cash flow can be said to equal:
A)
Q2: The longer the life of an investment:
A)
Q3: Firm X is considering the replacement of
Q5: Under the capital cost allowance system:
A) the
Q6: Which of the following is not a
Q7: The net present value profile:
A) doesn't work
Q8: A firm is selling an old asset
Q9: The net present value method is a
Q10: Which of the following is not a
Q11: Using higher discount rates,:
A) accelerated amortization is
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