Which of the Following Statements Is CORRECT

question 55

Multiple Choice

Which of the following statements is CORRECT?

• A) Under current laws and regulations, corporations must use straight-line depreciation for all assets whose lives are 5 years or longer.
• B) Corporations must use the same depreciation method (e.g., straight line or accelerated) for stockholder reporting and tax purposes.
• C) Since depreciation is not a cash expense, it has no effect on cash flows and thus no effect on capital budgeting decisions.
• D) Under accelerated depreciation, higher depreciation charges occur in the early years, and this reduces the early cash flows and thus lowers a project's projected NPV.
• E) Using accelerated depreciation rather than straight line would normally have no effect on a project's total projected cash flows but it would affect the timing of the cash flows and thus the NPV.

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Definitions:

Nursing-home Residents

Individuals living in facilities that provide a range of personal and medical care to meet the needs of people who cannot care for themselves independently.

Sense of Control

The belief or perception that one has the power to influence and direct the outcomes of events in their life, often linked to psychological well-being.

Disease

A disorder or malfunction of the mind or body that results in discomfort, dysfunction, distress, or death to the person afflicted.

Stress

A physical, mental, or emotional factor that causes bodily or mental tension and may be a factor in disease causation.