Which of the Following Cash Flows Should Not Be Included

question 14

Multiple Choice

Which of the following cash flows should not be included as incremental costs or revenues when evaluating capital projects?

• A) A new security system will reduce shoplifting losses by $50,000 per year.
• B) Thirty percent of the sales of a new product will result from customers switching from the previous version of the product.
• C) Interest on construction loans will increase interest expense by $225,000 per year.
• D) The project will occupy space which is currently being rented to another business for $3,000 per month.

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Definitions:

HIV Virus

Human Immunodeficiency Virus (HIV) is a virus that attacks and weakens the immune system, increasing the risk of developing infections and certain types of cancer.

Helper T Cells

A type of immune cell that plays a crucial role in the body's immune response by signaling other immune cells to fight off infections.

Antibody

A protein produced by the immune system that recognizes and binds to specific foreign substances, such as pathogens, to help neutralize or destroy them.

Virus

A virus is a microscopic infectious agent that replicates only inside the living cells of other organisms, potentially causing disease.