Which One of the Following Would NOT Result in Incremental

question 28

Multiple Choice

Which one of the following would NOT result in incremental cash flows and thus should NOT be included in the capital budgeting analysis for a new product?

• A) A new product will generate new sales, but some of those new sales will be from customers who switch from one of the firm's current products.
• B) A firm must obtain new equipment for the project, and $1 million is required for shipping and installing the new machinery.
• C) A firm has spent $2 million on R&D associated with a new product.These costs have been expensed for tax purposes, and they cannot be recovered regardless of whether the new project is accepted or rejected.
• D) A firm can produce a new product, and the existence of that product will stimulate sales of some of the firm's other products.
• E) A firm has a parcel of land that can be used for a new plant site or be sold, rented, or used for agricultural purposes.

---

Definitions:

Indents

The space left on the page before the start of a paragraph or text, used to structure and organize documents.

Increase or Decrease Indent

Adjusting the space between the margin and the text to control the paragraph format, either by moving it away from or closer to the margin.

Alignment Group

A set of formatting options in software that allows users to adjust how text or objects are aligned relative to each other or to a page.

Rotated Text

Text that has been turned around a point, changing its usual horizontal orientation to a different angle.