Which of the Following Is True Regarding Project Evaluation

question 163

Multiple Choice

Which of the following is true regarding project evaluation?

• A) Financing costs must be included in the statement of cash flows because they are not accounted for elsewhere.
• B) The stand-alone principle calls for evaluation of a project based on its incremental cash flows.
• C) Changes in NWC are not considered incremental cash flows.
• D) When fixed assets are sold at the project end, there are usually no tax consequences of the sale.
• E) Whether straight-line depreciation or CCA is used will have no impact on project NPV.

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