Which of the Following Statements Best Describes CCA

question 64

Multiple Choice

Which of the following statements best describes CCA?

• A) Using CCA method rather than straight-line depreciation 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.
• B) Corporations must use the same depreciation method (e.g., straight-line or CCA) for stockholder reporting and tax purposes.
• C) Since CCA deduction is not a cash expense, it has no affect on cash flows and thus no affect on capital budgeting decisions.
• D) Under CCA rules, higher CCA deductions occur in the early years, and this reduces the early cash flows and thus lowers a project's projected NPV.

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Definitions:

Consistent Message

Communication that is uniform and coherent across all marketing channels, ensuring that the brand's image and values are reinforced with each consumer interaction.

Promotion Alternatives

Different strategies companies use to market their products or services to consumers or other businesses.

Promotional Mix

The combination of marketing tools used by a business to execute its marketing strategy, including advertising, sales promotion, public relations, personal selling, and direct marketing.

Direct Marketing

The practice of delivering promotional messages directly to potential customers on an individual basis rather than through a mass medium.