Which of the following is NOT a disadvantage of the Payback Period project evaluation method? Select one: a. It does not focus on cash flow as the driver of value. b. It has an arbitrary cut-off point set by management. c. It does not adequately allow for risk. d. It fails to take account of the time value of money.

Q: Which of the following statements concerning the payback period, is not true? a. The payback period…

A: Solution:- Payback period is the time period at which the initial investment gets recovered from the…

Q: Which of the following statements is correct regarding the payback method? Takes account of…

A: Payback period is a tool of capital budgeting used to evaluate projects and investments.

Q: Why the payback method is often considered inferior to discounted cash flow in capital investment…

A: Payback period is capital budgeting technique which tells how much time will it take for Ann…

Q: Which of the following statements is (are) true about project appraisal methods: (i) NPV is the…

A: (i) NPV is the best measure for project appraisal even when capital is rationed.   There is no such…

Q: Which of the following statements is CORRECT? Assume that the project being considered has normal…

A: Internal rate of return (IRR) is the discount rate of a project which makes its NPV=0. It is a…

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: Which of the following is not a recommended solution if the comparison of projected cash flows with…

A: Option (a): This is a viable option. Finding additional income to manage the shortfall Option (c):…

Q: Which of the following statements is False regarding the payback period method: DA Use as a tool in…

A: Statement -D is false.As payback period method is Non- discounting cash flow criteria…

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 is a disadvantage of the internal rate of return criterion? Select one: a.…

A: Internal rate of return (IRR): At IRR, cash outflow will be equal to the present value of cash…

Q: Which of the following is a disadvantage of the IRR project evaluation method? Question 5Select…

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

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: Mr. Tim, the recently hired manager for this potential project is not convinced that using the IRR…

A: An indicator of the financial attractiveness of an investment is the modified internal rate of…

Q: Which of the following statements is false? The NPV and IRR always provide the same accept/reject…

A: The IRR is the rate of return at which the present value of the future cash flows is equal to the…

Q: When the present value of the cash inflows exceeds the initial cost of a project, then the project…

A: If present value of cash inflows exceeds the initial cost of a project, then NPV of the project will…

Q: Which of the following is correct?

A: The payback period is the time duration taken to reap back the amount invested in the project. The…

Q: The following is a disadvantage of ARR investment appraisal method (select one):   A. multiple or…

A: Accounting rate of return is a method that is used for evaluating the investment proposal. It is…

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.

Q: A unique feature of the analysis of a replacement decision is that Group of answer choices a. the…

A: The question is related replacement problem and the problem is of Capital Budgeting. In replacement…

Q: One of the benefit of the pay back period is that it focuses on the timing of the project`s benefits…

A: Payback period is a time taken to recover initial investment

Q: Which of the following is a disadvantage of the average rate of return method? a. fails to…

A: The question is asking about the disadvantages of the average rate of return method in accounting.…

Q: 3. Which of the following statements is CORRECT? Assume that the project being considered has normal…

A: Financial Management: Financial management comprises of two words i.e. Finance and management.…

Q: The ARR has one specific advantage not possessed by the payback period in that it a.considers the…

A: Definition:

Q: Which of the following is a disadvantage of the IRR project evaluation method? Select one: a. It…

A: IRR is the rate at which NPV is zero.

Q: disadvantage of using the accounting rate of return to evaluate investment alternatives is that…

A: Accounting rate of return (ARR) is a way of comparing profits that a business or a project is…

Q: Below are some statements about risk and investment appraisal. Which one is incorrect? A.…

A: risk increase with the length of a project.

Q: Is this statement ture or false? Requiring a relative short pay-back period for projects indicates a…

A: Short pay-back period

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.