Which Two Methods Are Typically Used for Initial Screening of Investments

question 69

Multiple Choice

Which two methods are typically used for initial screening of investments, rather than for detailed in- depth analysis?

• A)Net present value and payback
• B)Accounting rate of return and net present value
• C)Internal rate of return and net present value
• D)Payback and accounting rate of return

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Definitions:

Forecasted Costs

Estimated expenses for future periods based on historical data, trends, and statistical analysis.

Budgeted Costs

Estimated costs associated with a planned activity or project, used for financial planning and control.

Actual Costs

The true expenses incurred in the production of goods or provision of services, as opposed to estimated or budgeted costs.

Process Costing System

An accounting method used to allocate costs to units of product in industries where the production process is continuous and the units of product are indistinguishable from each other.