Which of the Following Is Not a Cash Flow Consideration

question 124

Multiple Choice

Which of the following is not a cash flow consideration in evaluating a proposed capital project?

• A)Increases in net working capital
• B)Basic overhead expenses
• C)Sales lost from other parts of the company because of the project
• D)Foregone depreciation resulting from a replacement machine

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Definitions:

Authorized Common Shares

The maximum number of common stock shares that a corporation is legally permitted to issue, as stated in its articles of incorporation.

Treasury Shares

Shares that were once part of the outstanding shares but were bought back by the company, reducing the amount of stock in the open market.

Sydney Tar Ponds

A hazardous waste site in Canada, notorious for its toxic sludge resulting from the byproducts of steel and iron industries.

Nova Scotia

A Canadian province located on the country's Atlantic coast, known for its maritime history and natural beauty.