Capital-Expenditure Management Involves Which of the Following

question 61

Multiple Choice

Capital-expenditure management involves which of the following?

• A)Determining which expenditures can be capitalised for accounting purposes.
• B)The planning and control of expenditures incurred in the expectation of deriving future economic benefits in the form of cash inflows.
• C)The amount of expenditure required by a company so that they are exempt from capital gains tax.
• D)Planning the amount of a company's annual budget that will be spent on human capital.

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Definitions:

Dividend Growth Model

A valuation method that estimates the price of a company’s stock based on the dividend per share and the dividend growth rate.

Constant Rate

A fixed rate, without variation or fluctuation over time.

Dividends

Dividends are payments made by a corporation to its shareholder members, usually derived from the company's profits.

Constant Growth Model

A method to value a stock by assuming that dividends grow at a constant rate indefinitely.