Once You Have Determined the Net Present Value of a Project

question 79

Multiple Choice

Once you have determined the net present value of a project, if the net present value is less than zero, the project should be

• A)accepted.
• B)rejected.
• C)evaluated further by evaluating future cash flows
• D)evaluated further by assessing future revenues and costs.

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Definitions:

Current Liabilities

Obligations that are due within one year or within the normal operating cycle of the business, whichever is longer.

Days' Sales In Inventory

Days' Sales in Inventory is a financial ratio that indicates the average time in days that a company takes to turn its inventory into sales.

Sales On Account

Transactions where goods or services are sold and payment is to be made at a later date, often recorded as accounts receivable.

Cost Of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including the cost of materials and labor.