The ____ of an investment is the period of time for the ____ to equal the initial cash outlay.   a. profitability index; present value of the cash inflows   b. payback period; cumulative cash inflows   c. payback period; present value of the cash inflows   d. None of these are correct

Q: Does the payback-period analysis ignore differences in the timing of cash flows?

A: The time value of money (TVM) is the possibility that in view of its inevitable procuring influence,…

Q: How is the value of an asset determined by predicted future cash flows?

A: The Answer

Q: How is IRR calculated with equal net cash inflows?

A:

Q: Which of the following statements is true for historical cost valuations? (Select one or more)…

A: According to accounting principles, a historical cost is a method of valuing assets in which the…

Q: Define the term reinvestment rate and describe how it differs for any cash flow series between (1) a…

A: Answer: Rate of return is nothing but the interest rate paid on the outstanding balance of money…

Q: The internal rate of return (IRR) is The same thing as the cost of capital. The discount rate that…

A: Capital budgeting is referred as the process of decision making which is used by companies to…

Q: In order to be consistent with Time Value of Money concepts , it is acceptable to add cash flows…

A: Amounts of money are worth more today than they will be in the future due to the concept of time…

Q: What is the maturity period required for an investment to qualify under the definitions of a cash…

A: Cash and cash equivalents correspond to just the line item on the balance sheet that lists the value…

Q: Capital account transactions are not affected by Select one: a. Investment diversification

A: Balance sheet is the representation of financial position of the company tha includes the assets,…

Q: Which of the following is the correct definition for present value (PV)?

A: Present value is an important concept in finance which is based on the concept of time value of…

Q: 20. This refers to the difference between the present value of cash inflows and the net present…

A: Net present value is used when capital budgeting decisions are to be made, with its help the…

Q: The measurement basis most often used to report a long-term paya a commitment to pay money at a…

A: Accounting Principals -Accounting standards, such as GAAP and IFRS, provide a set of rules and…

Q: Explain the difference between: a) Cash Flows versus Accounting Estimates b) Static Payback Period…

A: When a company prepares financial statements or budgets it has to estimate various amounts. The…

Q: In general, there are several ways to address a particular sequence of cash flows in order to…

A: Present value is sum of present value of cash flows. Future value is sum of future value of cash…

Q: What condition regarding cash flows would cause more than oneIRR to exist?

A: IRR (Internal Rate of Return) is the interest rate where net present value of a project equals to…

Q: In a cash flow series regarding the gradient: Select one: O a. Uniform gradient signifies that an…

A: When cash flows of a series changes with a constant amount, it is knows as gradient series.

Q: How is IRR calculated with unequal net cash inflows?

A: Definition:   Internal rate of return method (IRR): Internal rate of return method is one of the…

Q: Terminal value refers to the sum of all the net cash flows from an investment from the beginning to…

A: Given Statement, Terminal value refers to the sum of all the net cash flows from an investment from…

Q: Payback method is Select one: a. None of the options b. Yield on investment c. PV of cash inflow- PV…

A: Payback method is one of the capital budgeting technique which helps in evaluating profitability of…

Q: What is Internal Rate of Return - Monthly Fixed Cash Flows with Reversions?  Please provide…

A: The internal rate of return is the one of the discounted techniques of capital budgeting which is…

Q: Describe similarities between the indirect and the direct method of te statement of cash flow.…

A: Cash flow Statement-It is a statement that shows inflows and outflows of the cash and cash…

Q: True/false   Under IFRS, the discount rate should reflect risks for which future cash flow…

A: False  Refer step 2 for explanation

Q: oose the correct option- "This is the rate at which present value of cash inflows are equal to the…

A: Net present value or NPV is excess of present value of cash inflows over present value of cash…

Q: Describe the annual cash flow analysis, which presents measures of investment worth based on yield?

A: The question is based on the concept of cash flow and its analysis in terms of discounted value of…

Q: Which of the following should NOT be taken into account in calculating free cash flow? Select one:…

A: Free Cash Flow = Net income + Depreciation – Change in Working Capital – Capital Expenditure

Q: When constructing a Statement of Cash Flows, which of the following actions would be considered a…

A: Use of funds means use of cash for meeting working capital requirements or long term expenditure. We…

Q: A series of equal cash flows at fixed intervals is termed a(n)   a. price-level index   b. present…

A: A price index is a normalized  weighted average of price relatives for a given class of goods or…

Q: In the net present method future, cash flows are discounted to their present value a)TRUE b) FALSE

A: Under net present value method all future cash flows are discounted to their present value .

Q: Please answer the following questions 1. _________________ is the discounted net future cash…

A: Profitability Index= PV of cash inflows/Initial cash outlay where, PV= Present Value Balanced…

Q: Determining the future value of one or more present day cash flows is known as​ ________.   A.…

A: Future value is known as value in the future of present cash flows

Q: In the discounted cash flow (DCF) method, which of the following is the correct formula for…

A: EBIT represents the operating profit of a company before deducting interest and taxes.It's the…

Q: Consider the following statements concerning the payback method of investment appraisal. 1. It…

A: The payback method of investment appraisal is a simple technique that calculates the amount of time…

Q: Identify, at least, three reasons that make the profit for the reporting period not equal to the net…

A: Net cash inflow refers to the cash generated by an entity from its business after deducting all the…

Q: O discounting factor. O number of periods. O compounding factor. O interest rate. cash flow is…

A: Present value is the equivalent value of the future cash flow based on the time value of money and…

Q: In this method, the company compares the amount spent on the investment with the discounted expected…

A: a. Payback is the period in which the investment can break-even. b. NRV is the difference of…

Q: The funds invested in current assets are termed as

A: Working capital (WC) is the amount that arises from the difference of current assets (CA) and…

Q: How are incremental cash flows found in a replacement analysis?

A: The choice to substitute an existing asset with another is defined as the net current and internal…

Q: only interested in measuring cash flows when they actually occur, not when they accrue as an…

A: the company makes an investment in the project an individual make investment in various types of…

Q: An example of an operating budget schedule is the: cash budget budgeted balance sheet O capital…

A: examples of operating budgets - Purchase budget Sales budget cost of goods sold budget etc.   time…