Why Is an Adjustment Made to Net Income When Calculating

question 98

Multiple Choice

Why is an adjustment made to net income when calculating NOPAT?

• A)It is an amount on which income taxes are not considered.
• B)This adjustment amount has no cost of capital associated with it.
• C)Only assets that incur no interest costs are included with NOPAT.
• D)Divisional managers have no ability to control costs such as these.

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Definitions:

Learning Model

A theoretical framework describing how individuals acquire, process, and retain knowledge or skills.

Cultural Model

A framework or system of beliefs, values, and practices that is shared by a community and influences how its members perceive and interact with the world.

Psychodynamic Model

A theoretical approach in psychology that emphasizes the role of unconscious processes and childhood experiences in shaping personality and behavior.

Obsessive-Compulsive Disorder

A mental health disorder characterized by recurrent, unwanted thoughts (obsessions) and/or repetitive behaviors (compulsions).