Question:
When performing capital budgeting, __________ incurred by a project are irrelevant to future investment decisions.
A) Opportunity costs
B) Depreciation
C) Sunk costs
D) Taxes
Answer:
The correct answer is C) Sunk Costs
Explanation:
Capital Budgeting is the art (most applicable to corporate persons) of planning expenditure that will be incurred in the future, especially on long term assets.
The reason you cannot factor Sunk Cost into a Capital Budget is because of its very nature.
Sunk Costs refer to monies for items that have already been expended and can never be recovered. If it can never be recovered and has <u>already</u> been incurred, it has no role to play in future considerations especially when the purpose of Capital Budgetting is considered.
The primary purpose of a Capital Budget is that it helps to further evaluate the inflow against the outflow of an investment to check whether or not the return is acceptable.
Every other option given in the question above are items that have futuristic qualities.
Cheers
Answer:
a. $3,725
b. $3,945
Explanation:
a. The computation of the adjusted cash balance is shown below:
= Bank statement balance + Deposits in transit - outstanding checks
= $3,400 + $1,000 - $675
= $3,725
b. The computation of the book balance of cash before the reconciliation is shown below:
= Adjusted cash balance + service charge + NSF checks - interest earned - recording error
= $3,725 + $12 + $240 - $7 - $25
= $3,945
Answer:
$650
Explanation:
Let x be the list price of the Tvs
85% of x = 0.85x
90% of 0.85x = (0.9)(0.85)x
96% of (0.9)(0.85)x = (0.96)(0.9)(0.85)x
The net price is given by $477.36
Therefore, $477.36 = (0.96)(0.9)(0.85)x
Hence x = $477.36 / (0.96)(0.9)(0.85)
x = $477.36 / 0.7344
x = $650
So, the list price is the list price
Answer:
C)Foreign direct investment that increase US net capital outflow
Explanation:
From the question we are informed about A U.S. corporation who builts an amusement park in France. In this case, Its expenditures are U.S. Foreign direct investment that increase US net capital outflow. An expenditure can be regarded as payment used in purchasing goods or services either with cash or credit. It is regarded as money been spent on something. A foreign direct investment (FDI) can be regarded as an investment which is been set up by a firm or individual in ones country having business interests which is been located in another country. foreign direct investment do occur when foreign business operations is been set up by an investor or the investor is a able to acquire business assets in particular
foreign company.
