A Project with a Zero Net Present Value Indicates That

question 82

Multiple Choice

A project with a zero net present value indicates that it is

• A) unacceptable.
• B) profitable.
• C) acceptable.
• D) going to have an acceptable cash payback period.

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Definitions:

Warranty Expense

Costs that a company incurs to repair, replace, or compensate for faulty products during the warranty period.

Book Income

The income of a business as reported in its financial statements, following the principles of accounting.

Deferred Tax Liability

A tax obligation that arises from temporary differences between accounting and tax calculations, to be paid in the future.

Unearned Revenue

This is income received by a business for goods or services yet to be delivered or performed. It's considered a liability until the product or service is delivered.