____ Is Not a Method of Incorporating an Adjustment for Risk

question 55

Multiple Choice

____ is not a method of incorporating an adjustment for risk into the capital budgeting analysis.​

• A) ​Discriminant analysis
• B) ​Risk-adjusted discount rate
• C) ​Sensitivity analysis
• D) ​Simulation

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Definitions:

Income Summary

The income summary account is used in accounting to transfer revenue and expense account balances to determine the net income or loss for a given period before closing them to the retained earnings account.

Owner's Capital

The amount of money and assets invested in a business by its owner, representing the owner's claim against the company's assets.

Operating Cycle

The operating cycle, also known as the cash conversion cycle, is the time it takes for a company to purchase inventory, sell products or services, and collect the cash from these transactions.

Receivables

Money owed to a company by its customers or other parties for goods or services delivered but not yet paid for.