Which of the Following Statements Is FALSE

question 41

Multiple Choice

Which of the following statements is FALSE?

• A)Problems can arise using the IRR method when the mutually exclusive investments have different cash flow patterns.
• B)The IRR is affected by the scale of the investment opportunity.
• C)Multiple incremental IRRs might exist.
• D)The incremental IRR rule assumes that the riskiness of the two projects is the same.

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Definitions:

Sales Tax Expense

The cost incurred by a seller related to the sales tax charged on goods or services, which is often passed through to the consumer.

Interest Charged

Interest charged is the amount lenders impose on borrowers for the use of borrowed money, often expressed as an annual percentage rate.

Interest Payable

An account representing the amount of interest expense that has been incurred but not yet paid by a company.

Notes Payable

Financial obligations represented by written promissory notes in which the borrower agrees to pay back the amount borrowed, typically with interest, by a specified date.