Which of the Following Would Be Treated as an Extraordinary

question 12

Multiple Choice

Which of the following would be treated as an extraordinary item?

• A) Expropriation of an entity's operations in a foreign country
• B) The write-down of inventory due to obsolescence
• C) A loss resulting from a strike by workers against an entity
• D) The write-off of accounts receivable not expected to be collected

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Definitions:

NPV

Net Present Value, a calculation that compares the present value of a project or investment's cash inflows with its cash outflows.

IRR

Internal Rate of Return; a metric used in capital budgeting to estimate the profitability of potential investments.

Conventional Cash Flow

A cash flow pattern characterized by an initial investment outlay followed by a series of positive cash inflows.

Initial Cost

The original outlay or expense associated with acquiring an asset or launching a project, not including operational or maintenance costs.