Which of the Following Statements Is CORRECT

question 9

Multiple Choice

Which of the following statements is CORRECT?

• A) Since depreciation is not a cash expense,and since cash flows and not accounting income are the relevant input,depreciation plays no role in capital budgeting.
• B) Under current laws and regulations,corporations must use straight-line depreciation for all assets whose lives are 3 years or longer.
• C) If firms use bonus depreciation,they will write off assets slower than they would under straight-line depreciation,and as a result projects' forecasted NPVswould normally be lower than they would be if straight-line depreciation were required for tax purposes..
• D) If firms use bonus depreciation,they can write off assets faster than they could under straight-line depreciation,and as a result projects' forecasted NPVs would normally be lower than they would be if straight-line depreciation were required for tax purposes.
• E) If firms use bonus depreciation,they can write off assets faster than they could under straight-line depreciation,and as a result projects' forecasted NPVs would normally be higher than they would be if straight-line depreciation were required for tax purposes.

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Definitions:

Free Market Principles

Economic policies and systems that rely on supply and demand free from government intervention to govern market operations.

Information Flow

Describes the transfer and dissemination of information from its source to receivers through various channels or media.

War Times

Periods during which a country is engaged in armed conflict.

Journalists' War Coverage

The reporting and analysis of conflicts and wars by journalists, often involving on-the-ground reporting in areas of conflict.