Answered: The capital budgeting is associated…

The capital budgeting is associated with Select one: a. Short term assets b. Fixed assets c. None of the options d. Long terms assets e. Long terms and short terms assets

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter12: Capital Budgeting: Decision Criteria

Section: Chapter Questions

Problem 2Q: What types of projects require the least detailed and the most detailed analyses in the capital...

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The capital budgeting is associated with

Select one:

a. Short term assets

b. Fixed assets

c. None of the options

d. Long terms assets

e. Long terms and short terms assets

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Why are interest charges not deducted when a projects cash flows are calculated for use in a capital budgeting analysis?
The capital budgeting is associated with Select one: a. None of the options b. Short term assets c. working capital d. Liabilities e. Loans
In capital budgeting, a project is accepted only if the internal rate of return equals or: a. exceeds the net present value b. is less than the required rate of return c. exceeds the required rate of return d. exceeds the accrual accounting rate of return
The focus in capital budgeting is on a. Favorable and unfavorable variance b. Expenses under accrual accounting c. Expected future cash flows that differ between alternatives d. Allocation of overheads
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Short term investment decisions are also called as Select one: O a. Liquidity decision b. Finance Decision c. None d. Capital Budgeting decisions
What is the most commonly used capital budgeting procedures? Select one: a. IRR b. Payback period c. Discounted Payback period d. NPV e. Profitability Index
Which of the following statement is true? O a. Sunk cost is not relevant in capital budgeting decision O b. Capital budgeting decisions are based on past OC. Capital budgeting decisions are short term in nature O d. Capital Budgeting decisions can be changed anytime
When making a capital budgeting decision, which of the following are NOT relevant? The size of a cash flow The risk of a cash flow The accounting earnings from a cash flow The timing of a cash flow Multiple Choice I only II only III only II and III only III and IV only They are all relevant.
A firm's WACC for capital budgeting purposes for a planning period is a. The height of the MCC schedule at the expected level of capital spending. b. At the intersection of the MCC and the IOS c. Always beyond the break point of the MCC. d. Usually less than the cost of debt.
All of the following are data rules associated with capital budgeting EXCEPT: a. Include changes across the full life cycle of the product or service. b. Include changes in every functional area of the business. c. Include financing flows in the cash flows of all proposed projects. d. Include forecasted inflation in the cash flow estimates.
In the evaluation of cash flows in a capital budgeting decision , which of the following must be considered? I. The size of the cash flow II. The timing of the cash flow III. The risk of the cash flow a. I only b. I and II only c. II only d. II and III only e. I, II and III