The Internal Rate of Return Method Assumes That Project Cash

question 110

Multiple Choice

The internal rate of return method assumes that project cash flows can be reinvested at the project's ________.

• A) internal rate of return
• B) required rate of return
• C) growth rate
• D) accounting rate of return

---

Definitions:

Accumulated Depreciation

Accumulated depreciation is the total amount of depreciation expense that has been recorded for an asset since it was put into use, reducing its book value on the balance sheet.

Goodwill

An intangible asset that is created from such favorable factors as location, product quality, reputation, and managerial skill.

Boot

The remaining amount a buyer owes after the trade-in allowance when a fixed asset is traded in for a similar asset.

Accumulated Depreciation

Represents the total amount of depreciation expense that has been recorded for a fixed asset since it was put into use.