Which of the Following Statements Is Incorrect

question 9

Multiple Choice

Which of the following statements is incorrect?

• A)Revenue expenditures decrease net income.
• B)Capital expenditures decrease assets.
• C)Ordinary repairs and maintenance are considered revenue expenditures.
• D)Additions and improvements are considered capital expenditures.

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Definitions:

Cash Inflows

The total amount of money being transferred into a business, usually from its operations, investments, or financing.

Capital Outlay

Expenditures for acquiring or upgrading physical assets such as equipment or property.

Average Rate of Return

A measure of the profitability of an investment, calculated by dividing the average annual profit by the initial investment cost.

Present Values

The current valuation of a future financial gain or series of payments, after applying a specific return rate.