An Investment Should Be Accepted If ________

question 67

Multiple Choice

An investment should be accepted if ________.

• A) it has positive total cash inflows
• B) it has a payback period in less than 10 years
• C) the investment's rate of return is lower than the company's current year required rate of return
• D) the net present value is positive

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Definitions:

Beginning Inventory

The value of goods available for sale at the start of an accounting period, essential for calculating cost of goods sold and inventory turnover.

Net Sales

The revenue generated from sales after deducting returns, allowances for damaged goods, and discounts.

Markup

The amount added to the cost price of goods to cover overhead and profit.

Inventory Turnover

A ratio indicating how fast a company sells and replaces its stock of goods during a particular period.