Capital budgeting projects typically assume that all cash flows transpire at the end of the year.The reason for this is that:
A) less tax liability results from this practice.
B) balance sheets are prepared at the end of the year.
C) it is easier for the analyst in this manner.
D) most corporations collect their cash at the end of the year.

Question

Quizplus · Accepted Answer

Assuming cash flows at the end of the year simplifies the analysis and calculations for capital budgeting, making it easier for analysts to evaluate projects.

Capital Budgeting Projects Typically Assume That All Cash Flows Transpire