In Making a Capital Budgeting Decision, One Needs to Compare

question 72

Multiple Choice

In making a capital budgeting decision, one needs to compare cash flows in terms of

• A)their costs and revenues.
• B)when they occur and their costs and revenues.
• C)their amounts and when they occur.
• D)past and future expectations.

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Definitions:

Net Income

The profit a company has after deducting all its expenses from its total revenues, also known as the bottom line.

Paid Dividends

Cash or other assets distributed to shareholders out of the company's earnings.

Asset Balances

The valuation of an organization's resources, such as cash, investments, property, and equipment, reflected in its financial statements at a specific point in time.

Liability Balances

The outstanding obligations or debts that a company owes to third parties.