Capital Budgeting Techniques Such as Payback Method and Net Present

question 81

True/False

Capital budgeting techniques such as payback method and net present value are based upon Generally Accepted Accounting Principles (GAAP)and accrual accounting.

---

Definitions:

Maintenance Cost

The financial outlay required to maintain assets in efficient working condition over their useful life.

Committed Fixed Cost

Long-term fixed costs that a business incurs, such as lease agreements or long-term contracts with suppliers, which are not easily altered in the short term.

Property Taxes

Taxes assessed on real estate by a local government, based on the property's value, and used to fund public services.

Executive Travel

Expenses incurred for travel by company executives, often including transportation, accommodations, and meals, for business purposes.