Which Three of the Following Statements Accurately Relate to Profits

question 2

Multiple Choice

Which three of the following statements accurately relate to profits and cash flows?

• A) Project planning decisions should be focused primarily on a search for profit.
• B) Profit is a poor substitute for cash flow.
• C) Depreciation is not a cash flow and should be excluded from profit figures.
• D) Working capital adjustments may be needed to modify profit figures for NPV analysis.

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Definitions:

Adequate Compensation

Fair and reasonable payment or reimbursement for services, losses, or expenses incurred.

Legal Requirements

Obligatory laws or regulations that individuals or entities must adhere to.

Secretary of State

A high-ranking official in the federal government responsible for foreign affairs and also a key title within state governments in the U.S., overseeing various administrative duties.

Merger Approval

The formal consent given by relevant authorities or stakeholders for the combination of two or more entities into one, subject to compliance with legal and regulatory standards.