How Does Depreciation Affect the Calculation of a Project's Payback

question 10

Multiple Choice

How does depreciation affect the calculation of a project's payback period?

• A)Depreciation is deducted from the annual cash inflows.
• B)Depreciation is added to the annual cash inflows.
• C)Depreciation does not affect the payback calculation.
• D)Depreciation is only deducted if the payback period exceeds five years.

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Definitions:

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A legal principle used to clarify the law by restating existing statutes or case law in a simplified manner.

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