Which of the Following Is a Capital Budgeting Method That

question 104

Multiple Choice

Which of the following is a capital budgeting method that ignores the time value of money?

• A) payback
• B) internal rate of return
• C) return on assets
• D) net present value

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Definitions:

Predetermined Manufacturing Overhead

An estimated rate used to assign manufacturing overhead costs to cost objects during a specific period, calculated before the period begins.

Direct Labor-hour

A measure of the total time workers or employees spend creating a product, which is used in calculating the labor cost involved in production.

Finished Goods Inventories

Products that have completed the manufacturing process but have not yet been sold to customers.

Direct Labor Costs

The wages paid to workers directly involved in the production of goods or services.