Proceeds from the issuance of new debt and principal payments upon maturity of debt used to finance a project should be included in the calculation of the project's after-tax cash flows.

Question

Quizplus · Accepted Answer

Proceeds from the issuance of new debt are a form of financing and do not directly impact the project's operational cash flows. Similarly, principal payments upon maturity of debt are financing activities and are not included in the calculation of after-tax cash flows, which focus on the operational performance and cash impacts of the project.

Proceeds from the Issuance of New Debt and Principal Payments