Which of the Statements Below Is FALSE

question 97

Multiple Choice

Which of the statements below is FALSE?

• A) The net present value decision model is an economically sound model when comparing different projects across a wide variety of products, services, and activities under capital constraint.
• B) The greater the NPV of a project, the greater the "bag of money" for doing the project, and more money is better. If a company is short of capital, it would choose those projects that provide the largest "bag of money."
• C) Despite all of the advantages of using the NPV Model, it is inconsistent with the concept of the time-value-of-money.
• D) By discounting all future cash flows to the present, adding up all inflows, and subtracting all outflows, we are determining the current value of the project.

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Definitions:

Ending Inventory

The aggregate worth of items on offer at the termination of an accounting cycle.

Beginning Inventory

The value of inventory held by a business at the start of an accounting period.

Inventory Costing Method

Techniques used to assign costs to inventory and cost of goods sold, such as FIFO (First-In, First-Out) or LIFO (Last-In, First-Out).

Gross Profit

The financial metric calculated by subtracting the cost of goods sold from net sales, representing the profit from selling goods before deducting operating expenses.