Relevant cash inflows and outflows in a discounted cash flow analysis are the differences in expected future cash flows as a result of making the investment. The income taxes saved as a result of depreciation deductions are relevant because they decrease cash outflows, but the depreciation itself is a noncash item. True False: Relevant cash inflows and outflows in a discounted cash flow analysis are the differences in past cash flows that resulted from making previous investments. False: neither the income taxes saved as a result of depreciation deductions nor the depreciation itself is considered relevant both B and C none of the above

Q: Identify which from the following scenarios depict relevant cash flows in making the decision…

A: While making decision for accepting two alternatives, we always consider relevant cost and relevant…

Q: The present value of cash flows in Investment A is lower than the present value of cash flows in…

A: Discount rate is very important FACTOR in calculating the present value of cash flow. Particularly…

Q: Depreciation is a non-cash charge, it doesn’t affect the results of cash budget analysis.  True…

A: Depreciation is charged as reduction or decrease in value of fixed assets over the period of time.…

Q: What factors affect the interest rate used to discount the cash flow expected from a financial asset

A: the interest rate that is used to discount the cashflow expected from a financial asset is nothing…

Q: Under the indirect method of estimating project cash flows, an increase in trade creditors in a…

A: Cash flow statement is divided into three activities i.e. cash flow from operating activities, cash…

Q: indirect method of reporting cash flows from operating activities focuses on the differences between…

A: Cash flow statement is a financial statement that shows how changes in balance sheet accounts and…

Q: The payback method measures: The profitability of an investment. The net cash inflow from an…

A: Pay back period is most popular method of capital budgeting decisions and is quite simple to use and…

Q: Which of the following statements is correct? The NPV method assumes that cash flows will be…

A: Solution:- Net Present Value (NPV) means the net of the present value of cash inflows and initial…

Q: A project is rejected under the net present value method when: a. The percentage return is greater…

A: Capital budgeting is a process used to gauge if an investment should be made in a particular project…

Q: 10

A: Cash flow refers to the total amount of cash and its equivalents that travel in and out of a company…

Q: esearch articles that deal with the benefits which might be derived from the Statement of Cash…

A: In accounting cash flow statement is that financial statement that shows different soucres of cash…

Q: fe of the project. Which one of the following statements is correct with respect to this…

A: NPV Method assumes that all the cash flows are reinvested at the company's Cost of Capital. IRR…

Q: echnical problems associated with the internal rate of return include:

A: IRR (Internal Rate of Return): It is the rate of return that makes the net present value of the…

Q: One of the shortcoming of the payback method is that it ignores cash flows after the payback period.…

A: Payback method has serious disadvantages like it Ignores the time value of money.

Q: Which of the following items describes a weakness of the internal rate-of-return method?a. The…

A: IRR (Internal Rate of Return):

Q: The NPV method determines how much the present value of cash inflows exceeds the present value of…

A: The amount of difference between the PV (present value) of cash inflows and cash outflows is called…

Q: Help question 18

A: Cash flow statement:   It is a financial statement used by a company to report the cash inflow and…

Q: The payback period has the following weaknesses as decision criterion for capital projects:   Uses…

A: Answer:-  Payback period meaning:- Payback period is the amount of time generally required to…

Q: lect the correct response High professional fees of appraisers Inability to forecast future cash…

A: The answer is stated below:

Q: Which of the following statements is CORRECT?    a. The future value of an annuity table is most…

A: Time value concept is useful to evaluate any investment opportunities. One can understand what is…

Q: Which of the following decisions do NOT influence the cash from operating activities slide?  Which…

A: Operating Activities are company core business activities such as manufacturing , distributing ,…

Q: The NPV method assumes that cash inflows associated with a particular investment occur when? Group…

A: Net present value method or NPV in this present value of cash flow is determined and from that…

Q: The Payback method takes the initial investment and divides it by the accelerated depreciation per…

A: Payback Period : The Payback Period is a Period in which a project repay its initial cost of…

Q: Which of the following phrases best describes the term " actual cash value"? a. market value b.…

A: Actual cash value is the actual amount at which the property could be sold and it is usually less…

Q: Which of the following statements best describes the difference between the IRR method and the MIRR…

A: Note: As per the policy, we are supposed to solve one question at a time. Kindly repost the further…

Q: The internal rate of return method of evaluating capital investments can be used with uneven cash…

A: Uneven cash flows is a series where the cash flows are not the same throughout the project's life.…

Q: Why are cash balances in excess of those needed to financebusiness operations viewed as relatively…

A:

Q: All of the following are weaknesses of the payback period EXCEPT Select one: a. only an implicit…

A: Payback period is period required to recover initial investment in the project.

Q: Which of the following is an advantage of cash basis accounting vs. accrual basis accounting?   It…

A: Answer:- correct option is It provides a more accurate representation of cash generated in a…

Q: Which of the following statements Is false with respect to the simple rate of return? Multiple…

A: Formula: Simple rate of return = Average profits / Initial investment

Q: Calculate the present value and future value of an uneven cash flow stream.

A: A stream of cash flow is uneven  when all the amounts in the series of cash flows are unequal .i.e.,…

Q: An advantage of the net present value method over the internal rate of return model in discounted…

A: The internal rate of return model considers the constant discounting rate for discounting the cash…

Q: Which statement characterizes the time value of money concept?  A) The future value of a present…

A: Present value means worth of a dollar today Future value worth of a dollar in future.

Q: Since a financial manager prefers to receive cash flows as fast as possible,____. A. a longer…

A: The pattern of cashflows can be significantly affected by the depreciable life of an asset.

Q: When Generating a Statement of Cash Flows, the direct method of preparation would result in a…

A: Cash flow statement (CFS) is a financial statement prepared by the company at the end of every year…

Q: The basic principle of valuation states that the value of any asset is: O The sum of the present…

A: The present value of an asset is the sum of all future cash flows discounted at the discount rate.

Q: period

A: Payback period is defined as the time taken to recover the cost of an investment. In other words it…

Q: Why is it more reasonable to assume, as the NPV rule does, that the intermediate cash flows are…

A: Before investing in new assets or projects, profitability is evaluated by using various methods like…

Q: Which of the following is a disadvantage of the IRR project evaluation method? Select one: a. It…

A: IRR is the rate at which NPV is zero.

Q: Which of the following statements is false? A. Net incomes are not cash flows. Financial Managers…

A: Capital budgeting are the process through which the firm decide which project to take up.

Q: This can occur when a selection among mutually exclusive alternatives is based wrongly on…

A: Answer-    Ranking errors can occur when a selection among mutually exclusive alternatives is based…

Q: In solving measurement problems involving the use of annuities, which of these four required…

A: Financial accounting: Financial accounting is the process of recording, summarizing, and reporting…