A: The initial investment in working capital is a cash outflow at the ending of the project for items such as inventories
B: Working capital is recaptured at the end of the project when working capital is no longer required
C: Depreciation is not a current cash outflow.
D: Discounted cash flow methods automatically provide for a return of the original investment, thereby making a deduction for depreciation unnecessary
举一反三
- _____ refers to the difference between a firm's current assets and its current liabilities. A: Operating cash flow B: Capital spending C: Net working capital D: Cash flow from assets
- A project has the following projected cash inflows.Year 1 100,000Year 2 125,000Year 3 105,000Working capital is required to be in place at the start of each year equal to 10% of the cash inflow for that year. The cost of capital is 10%.What is the present value of the working capital? A: $ Nil B: $(30,036) C: $(2,735) D: $33,000
- Which of the following might be associated with a lengthening working capital cycle? A: Higher net operating cash flow B: Decreasing depreciation expenditure C: Quicker inventory turnover D: Taking less time to pay suppliers
- Which of the following statements is false （ ) A: Payback period is the time in which the initial cash outflow of an investment is expected to be recovered from the cash inflows generated by the investment. B: Payback period usually expressed in years or months. C: Annual cash flow is variable D: Payback Period = Initial Cost / Annual cash inflow
- A capital investment’s internal rate of return( ). A: Must exceed the cost of capital in order for the firm to accept the investment. B: C: Statements c and d are correct. D: Changes when the cost of capital changes. E: Is similar to the yield to maturity on a bon F: Is equal to the annual net cash flows divided by one half of the project’s cost when the cash flows are an annuity.
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- 0
A capital investment’s internal rate of return ( ) A: Changes when the cost of capital changes. B: Must exceed the cost of capital in order for the firm to accept the investment. C: Statements c and d are correct. D: Is similar to the yield to maturity on a bond. E: Is equal to the annual net cash flows divided by one half of the project’s cost when the cash flows are an annuity.
- 1
Which one of the following terms is defined as the mixture of a firm's debt and equity financing? A: cash management B: cost analysis C: capital structure D: working capital management
- 2
Which one of the following is defined as a firm's short-term assets and its short-term liabilities? A: debt B: working capital C: investment capital D: net capital
- 3
In a three-step process for converting cash flow from the indirect to direct presentation, which of the following statements is most accurate The last step in the process is to:（） A: aggregate all revenues and all expenses. B: convert accrual amounts to cash flow amounts by adjusting for working capital changes. C: remove all noncash items from aggregated revenues and expenses and break out remaining items into relevant cash flow items.
- 4
Which of the following is NOT a reason why cash flow may not equal net income? A: Amortization is added in when calculating net income. B: Changes in inventory will change cash flows but not income. C: Capital expenditures are not recorded on the income statement. D: Depreciation is deducted when calculating net income.