Which of the Following Are Two Methods of Analyzing Capital

question 22

Multiple Choice

Which of the following are two methods of analyzing capital investment proposals that both ignore present value?

• A) internal rate of return and average rate of return
• B) net present value and average rate of return
• C) internal rate of return and net present value
• D) average rate of return and cash payback method

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Definitions:

Cash Dividends

Payments made by a corporation to its shareholder members out of its earnings. It represents a share of corporate profits.

Property, Plant, Equipment

Long-term tangible assets used in the operation of a business and not intended for resale.

Operating Activities

Operating activities relate to the primary business activities of a company, such as production, distribution, and marketing, which generate revenue and expenses reflected in the income statement.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including material, labor, and overhead costs.