Because before-tax cash flows are necessary for an adequate capital budgeting analysis, international tax effects need not be determined for a proposed foreign project.

Question

Quizplus · Accepted Answer

The statement is false. International tax effects need to be determined and considered in capital budgeting analysis for a proposed foreign project. This is because tax laws and regulations vary across countries and can significantly impact the cash flows and profitability of a project. Therefore, before-tax cash flows alone may not provide an accurate picture of the project's returns, and after-tax cash flows with international tax effects should be analyzed to make informed investment decisions.

Because Before-Tax Cash Flows Are Necessary for an Adequate Capital