Stockinger Corporation Has Provided the Following Information Concerning a Capital

question 225

Multiple Choice

Stockinger Corporation has provided the following information concerning a capital budgeting project: The company's income tax rate is 30% and its after-tax discount rate is 11%. The working capital would be required immediately and would be released for use elsewhere at the end of the project. The company uses straight-line depreciation on all equipment. Assume cash flows occur at the end of the year except for the initial investments. The company takes income taxes into account in its capital budgeting.The total cash flow net of income taxes in year 3 is:

• A) $77,000
• B) $80,000
• C) $48,000
• D) $128,000

---

Definitions:

Internal Consistency Reliability

A type of reliability that examines whether items on a test measure only one dimension, construct, or area of interest.

Interrater Reliability

The level of agreement among multiple observers or raters of the same phenomenon or measurement.

Concurrent

Existing, happening, or done at the same time.

Test-Retest

A method used to assess the consistency of a measure by comparing the scores of the same participants on the same test administered at two different times.