What Is the NPV of the Project If First Year

question 10

Multiple Choice

What is the NPV of the project if first year savings are only $75,000 and the project is sold?

• A) ($4,545)
• B) ($15,691)
• C) $15,691
• D) $75,000

---

Definitions:

GAAP Financial Statements

Financial statements prepared following Generally Accepted Accounting Principles, which are a set of rules and standards for financial reporting.

Executive Compensation

The total pay and benefits, including salary, bonuses, and stock options, received by corporate executives for their management services.

Annual Report

A comprehensive report on a company's activities throughout the preceding year, intended to give shareholders and other interested parties information about the company's financial performance.

Accounting-based Incentive Plans

Compensation plans that reward employees based on meeting certain accounting metrics, such as earnings per share or return on assets.