The Operating Cash Flows of a Project

question 98

Multiple Choice

The operating cash flows of a project:

• A)are unaffected by the depreciation method selected.
• B)are equal to the project's total projected net income.
• C)decrease when net working capital increases.
• D)include any aftertax salvage values.
• E)include erosion effects.

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Definitions:

Fixed Costs

Expenses that do not change with the level of production or sales activities over a relevant period.

Contribution Margin

The difference between sales revenue and variable costs, indicating the amount contributed towards covering fixed costs and generating profit.

Performance Reports

Documents that review and assess the performance of individuals, departments, or organizations against planned objectives.

Cost Centers

Parts of an organization where costs are accumulated for internal accounting purposes but do not directly generate revenue.