The Computer Is the Primary Tool of the Tax Professional

question 45

Multiple Choice

The computer is the primary tool of the tax professional.The tax professional uses the computer for all of the following client services except

• A)tax planning for clients.
• B)tax research for client questions.
• C)investment purchases on behalf of clients.
• D)tax return preparation.

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Definitions:

Annual Cash Inflow

The total amount of money received by a company from its various activities, including sales, investments, and financing, within a year.

Discount Rate

The interest rate critical for calculating the present-day valuation of future cash flows in discounted cash flow methodology.

Net Present Value

The difference between the present value of cash inflows and the present value of cash outflows, used in capital budgeting to assess the profitability of investments or projects.

Initial Cost

Initial cost refers to the total amount of expenses incurred when acquiring a new asset or starting a new project, including purchase price and any additional costs necessary to get the asset into use.