Which of the following is a disadvantage of the IRR project evaluation method? Select one: a. It does not take into account the time value of money. b. If there are negative cash flows after positive cash flows, there may be zero or multiple internal rates of return. c. It does not make adequate allowance for risk. d. It focuses on accounting profit rather than cash flow as the source of value.

Q: Which of the following is not a correct statement O a. Profit maximization is vague conceptually.…

A: The profit maximization concept explains that the company should undertake such actions, investments…

Q: Which of the following cash flows should not be considered when evaluating a project? Changes in…

A: Following cashflows should not be considered when evaluating a project-

Q: ternal rate of return (IRR) and net presetn value (NPV):  -Generally arrive at the same…

A: Net present value is basic technique used in capital budgeting as it considers the time value of…

Q: Sophisticated capital budgeting techniques do not A. examine the size of the initial outlay. B.…

A: Capital budgeting techniques are used to understand the feasibility/acceptability of long term…

Q: Disadvantage of the payback method include: Answer choices are below: A) does not consider cash…

A: The correct answer is D) all of the above. The payback method indeed has several disadvantages. It…

Q: Depreciation is a non-cash charge, it doesn’t affect the results of cash budget analysis.  True…

A: Depreciation is charged as reduction or decrease in value of fixed assets over the period of time.…

Q: Suppose you finance a project partly with debt, you should neither subtract the debt proceeds from…

A: The statement in question is addressing two key aspects of project financing and cash flow…

Q: Which of the following statements is false? (You may select more than one answer.)a. The total-cost…

A: Capital budgeting refers to the process by which long-term investment proposals are evaluated based…

Q: Kosovski Company is considering Projects S and L, whose cash flows are shown below. These projects…

A: IRR is also known as Internal rate of Return. It is a capital budgeting technique which helps in…

Q: Ignoring differences in the useful lives of investments when evaluating ca

A: Capital expenditures are distinct from operating expenditures, which are day-to-day spending…

Q: True or False: It is often impossible to forecast the cash flows from follow-on projects associated…

A: TRUE

Q: A key difference between the IRR and the MIRR is a. cash flows are assume be reinvested at the risk…

A: IRR is rate of return at which present value of cash flow is equal to initial investment in the…

Q: If an investment project will positively affect the cash flows of other products the firm currently…

A: Cannibalization can be defined as the negative effect on the existing business line or the product…

Q: Which of the following are significant flaws with the Payback Period Method? (Select all that apply)…

A: Payback period method is a capital budgeting method which will help in finding time period within…

Q: State why payback analysis should be used only as a supplemental analysis tool when an economic…

A: Payback analysis is the method for calculating payback period of an investment. Payback period is…

Q: How will a decrease in time preferences affect the loanable funds market?   A.   There will be an…

A: Decrease in time preferences tells us that individuals in the economy are more patient and more…

Q: When evaluating projects using internal rate of return,?  A. projects having lower early-year cash…

A: Internal rate of return is the rate of return at which the net present value is equal to zero.…

Q: Discuss what impact will an inaccurate progress estimate have on cash flow? . Discuss the reasons…

A: An inaccurate progress estimate can have a significant impact on cash flow for a project. Cash flow…

Q: Which of the following statements is false The net present value method considers the time value of…

A: This is based on the principles of capital budgeting tools.   We use different capital budgeting…

Q: The payback rule is generally most useful when:

A: The payback period is the time taken to recover the money spent on the project. According to the…

Q: Which ones identify the disadvantages of the payback rule? A. Very simple and easy to apply. B.…

A: Solution: Payback period is one of the decision making criteria in capital budgeting. It measures…

Q: An analysis of a proposal by the net present value method indicated that the present value of future…

A: The objective of the question is to understand the implications of a positive net present value…

Q: . A. it is very A disadvantage of the average rate of return method of capital investment analysis…

A: Average rate of return method of capital investment analysis:The average rate of return is the…

Q: Ranking conflicts (or conflicts in project choice) can arise between IRR and NPV decision rules when…

A: IRR is the actual rate of return expected from the investment or project. Whereas the NPV means the…

Q: What theorem is this a plain-language interpretation of? "Leaving an investment that loses money on…

A: The term "investment" describes the distribution of resources, most commonly money, with the hope of…

Q: An analysis of a proposal by the net present value method indicates that the present value of future…

A: The objective of the question is to understand the implications of a negative net present value…

Q: 3. In a comparison of the NPV and IRR techniques, which of the following is true? statements A. Both…

A: In this question, we are required to determine the correct statement regarding NPV and IRR.

Contract Costing

Contract costing is about tracing particular costs related to a particular contract entered into with the customer. It is one of the forms of job order costing. It is useful in long-term contracts at the most. It is seen that substantial time is required for the completion of the contract which takes different accounting periods. Thus, it is very much helpful for recognizing the costs associated with it and accounting in their specific accounting periods.