Flashcards in Chp4-Quiz Deck (10):

1

## To determine cash flow depreciation is

### added to net income

2

## Which of the following items is a cost in a capital budgeting incremental analysis?

### major overhaul

3

## The internal rate of return is the discount factor necessary to make an investment's NPV greater than one.

### FALSE

4

## ***Which of the following discounted cash flow techniques matches the present value with the future value so that the net result is zero?

### IRR

5

## ***The ITC in capital budgeting analysis is

### A benefit

6

## ***The payback method accounts for the time value of money.

### FALSE

7

## ***In theory, the residual value is the present value of future cash flows beyond the time horizon.

### TRUE

8

## NPV reports in present dollar terms how much value will be added to a company as a result of making a particular investment.

### TRUE

9

## A technique that is widely used to identify incremental benefits and costs is

### differential analysis

10