Capital budgeting analysis focuses on cash flow as opposed to profits.

Name: Capital budgeting analysis focuses on cash flow as opposed to profits.
Brand: Quizplus
Rating: 4.9 (37 reviews)

Question

Quizplus · Accepted Answer

Capital budgeting analysis is concerned with the assessment of the cash inflows and outflows of a project or investment proposal rather than focusing solely on the profits generated. This is because profits do not necessarily translate into positive cash flows, and it is the cash flows that ultimately determine the financial viability of the project.

Capital Budgeting Analysis Focuses on Cash Flow as Opposed to Profits