Which of the Following Is Not Relevant Information in a Decision

question 111

Multiple Choice

Which of the following is not relevant information in a decision whether old equipment presently being used should be replaced by new equipment?

• A) The cash price of the new equipment
• B) The salvage value of the old equipment
• C) The book value of the old equipment
• D) The cost savings if the new equipment is purchased

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Definitions:

Cash Dividends

Payments made by a company out of its profits to shareholders, usually in the form of cash.

Common Stock

A type of security that represents ownership in a corporation, giving holders voting rights and a proportionate share in the company's profits through dividends or capital appreciation.

Bonds Payable

Long-term debt instruments issued by a company to investors, promising to pay back a specified sum of money at a future date along with periodic interest payments.

Cash Dividends

Payments made by a corporation to its shareholders from earnings, usually in the form of cash.