Which of the Following Statements Is CORRECT

question 49

Multiple Choice

Which of the following statements is CORRECT?

• A) Under current laws and regulations, corporations must use straight-line depreciation for all assets whose lives are 5 years or longer.
• B) Corporations must use the same depreciation method for both stockholder reporting and tax purposes.
• C) Using accelerated depreciation rather than straight line normally has the effect of speeding up cash flows and thus increasing a project's forecasted NPV.
• D) Using accelerated depreciation rather than straight line normally has no effect on a project's total projected cash flows nor would it affect the timing of those cash flows or the resulting NPV of the project.
• E) Since depreciation is a cash expense, the faster an asset is depreciated, the lower the projected NPV from investing in the asset.

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Definitions:

Charles Darwin

A British naturalist of the 19th century best known for his contributions to the science of evolution, particularly the theory of natural selection.

Conditioned Stimulus

A conditioned stimulus is a previously neutral stimulus that, after association with an unconditioned stimulus, comes to elicit a conditioned response.

Salivates

The process of producing saliva, a digestive fluid, in response to the presence of food or the anticipation of eating.

Conditioned Stimulus

A previously neutral stimulus that, after becoming associated with an unconditioned stimulus, eventually comes to trigger a conditioned response in a subject.