Which of the Following Statements Concerning Depreciation and Capital Budgeting

question 7

Multiple Choice

Which of the following statements concerning depreciation and capital budgeting is true?

• A)Depreciation can reduce cash outflows through savings in income tax.
• B)The tax effects of depreciation are mostly irrelevant as capital budgeting analysis is generally done with before tax information.
• C)Some depreciation charges can affect cash flows both directly and through effects on income tax.
• D)Because depreciation is a non-cash item,it can never affect cash flows.

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Definitions:

Synaptic Gaps

Tiny spaces between neurons across which neurotransmitters pass to facilitate neural communication.

Neural Pathway

A neural pathway consists of a series of connected neurons that communicate through neurotransmitters to send signals between different parts of the brain or between the brain and the rest of the nervous system.

Action Potentials

Rapid, temporary changes in the electrical charge of a cell membrane, which are essential for nerve impulse transmissions.

Opiate Drugs

Substances derived from opium or synthetically made to mimic its effects, typically used to relieve pain but also known for their potential for addiction and abuse.