The Net Present Value Method Can Only Be Used in Capital

question 117

True/False

The net present value method can only be used in capital budgeting if the expected cash flows from a project are an equal amount each year.

---

Definitions:

Job-order Costing

A cost accounting system that assigns manufacturing costs to an individual product or batch of products, useful for customized orders.

Indirect Labor Cost

Wages and related expenses for workers who assist in or facilitate the production process but do not directly work on the product.

Direct Materials Cost

The expenditure on raw materials that are directly traceable to the production of a specific product.

Direct Labor Cost

Expenses associated with employees who directly contribute to the production of goods, such as wages for assembly-line workers.