Which of the Following Statements Is CORRECT

question 49

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 for both stockholder reporting and tax purposes.
• C) Using accelerated depreciation rather than straight line normally has the effect of speeding up cash flows and thus increasing a project's forecasted NPV.
• D) Using accelerated depreciation rather than straight line normally has no effect on a project's total projected cash flows nor would it affect the timing of those cash flows or the resulting NPV of the project.
• E) Since depreciation is a cash expense, the faster an asset is depreciated, the lower the projected NPV from investing in the asset.

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Definitions:

Innovative

The quality of being able to create new ideas, products, or methods; characterized by originality and the ability to solve problems or address needs in novel ways.

Market-Leading

A Market-Leading company is one that holds a dominant position in its industry or sector, characterized by the highest market share, strong brand recognition, and a significant influence over market trends.

Family Leadership

The role of guiding and influencing a family, managing its relationships and assets, often in the context of a family business.

Negative Caricatures

These are exaggerated or distorted representations, often in media or discussion, that cast individuals or groups in a negative light.