Which One of the Following Indicates That an Independent Project

question 55

Multiple Choice

Which one of the following indicates that an independent project is definitely acceptable?

• A)Profitability index greater than 1.0
• B)Negative net present value
• C)Modified internal rate return that is lower than the requirement
• D)Zero internal rate of return
• E)Positive average accounting return

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Definitions:

Equivalent Units

A concept in cost accounting used to allocate costs to partially completed goods, converting them into the number of fully completed units that could have been produced with the same amount of input.

Conversion Costs

The total expense of converting raw materials into finished products, typically including both direct labor costs and manufacturing overhead.

Finished Goods Warehouse

A storage area or facility where manufactured products are kept until they are sold or distributed to customers.

Process Costing System

A costing method used for homogenous products, distributing costs across units of output on an average basis.