What Effect Is Expected at the End of the Life

question 35

Multiple Choice

What effect is expected at the end of the life of a project that initially required a $20,000 increase in net working capital?

• A) The $20,000 must now be paid by the firm.
• B) The firm receives a $20,000 cash inflow.
• C) Taxable income is reduced by $20,000.
• D)No effects are expected because the $20,000 is now a sunk cost.

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Definitions:

Memo

A written communication, usually brief and formal, used to convey information or instructions within an organization.

Gathering

The action of bringing together people or collecting things.

Structure

The arrangement or organization of components within a system, document, or composition, influencing function or perception.

Layout

The arrangement of elements such as text and images on a page or in a document.