Which of the Following Capital Budgeting Techniques Ignores the Time

question 84

Multiple Choice

Which of the following capital budgeting techniques ignores the time value of money?

• A) Payback.
• B) Net present value.
• C) Internal rate of return.
• D) Two of the above.

---

Definitions:

Process Costing

A costing method used in production where costs are assigned to processes and then averaged over all units produced.

Job-Order Costing

An accounting method that assigns costs to specific jobs or batches, used in industries where goods or services are produced on a custom basis.

Process Costing

An accounting methodology that traces and accumulates direct costs, and allocates indirect costs, of a manufacturing process. Costs are assigned to products, usually in a large batch, which might include an entire month's production.

Job-Order Costing

A costing method used in manufacturing, where costs are assigned to specific jobs or batches, ideal for customized orders.