When projecting future cash flows of an investment ________.

Question

Quizplus · Accepted Answer

When projecting future cash flows, the initial investment is usually a significant cash outflow that is treated separately from all other cash flows. This is because the initial investment is a one-time expense, while future cash flows involve recurring expenses and revenues. Depreciation is not included in cash flows, and cash inflows and outflows are typically netted together. Furthermore, projecting future cash flows is a collaborative effort that involves input from various departments, not just accounting personnel.

When Projecting Future Cash Flows of an Investment ________