The Acquisition of All the Following Assets Are Considered in Capital

question 26

Multiple Choice

The acquisition of all the following assets are considered in capital budgeting except

• A)purchase of trucks.
• B)purchase of office equipment.
• C)bringing a new product to market.
• D)purchase of inventory.

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Definitions:

Unit Sales

The quantity of product sold by a company in a given period.

Unit Contribution Margin

Unit Contribution Margin is the difference between the selling price of a unit and the variable cost associated with making that unit, indicating how much each unit contributes to covering fixed costs and generating profit.

Advertising Budget

The amount of money allocated for promoting products, services, or a brand during a specific period.

Net Operating Income

A measure of a company's profitability that excludes interest and income tax expenses.