Which of the Following Statements Is CORRECT

question 38

Multiple Choice

Which of the following statements is CORRECT?

• A) Using accelerated depreciation rather than straight line would normally have no effect on a project's total projected cash flows but it would affect the timing of the cash flows and thus the NPV.
• B) Under current laws and regulations, corporations must use straight- line depreciation for all assets whose lives are 5 years or longer.
• C) Corporations must use the same depreciation method (e.g., straight line or accelerated) for stockholder reporting and tax purposes.
• D) Since depreciation is not a cash expense, it has no effect on cash flows and thus no effect on capital budgeting decisions.

---

Definitions:

Top-Down Processing

A cognitive process that starts with the higher-level brain functions to interpret sensory information, based on knowledge, expectations, and context.

Bottom-Up Processing

A type of information processing based on incoming data from the environment to form a perception, starting from the most basic level of sensory input.

Feature Analysis

A cognitive process by which the brain breaks down visual stimuli into individual features to understand and recognize objects.

Depth Perception

The visual ability to perceive the world in three dimensions (3D) and the distance of an object.