accounting final

Which of the following capital budgeting methods ignores the time value of money? A. ARR B. Internal rate of return C. Npv D. Profitability index

A. ARR

The internal rate of return is: A. the interest rate at which the net present value of the investment equals the cost of the investment. B. the interest rate at which the npv of the investment exceeds the co's desired ROR C. equal to the ARR D. none of the above

A. the interest rate at which the net present value of the investment equals the cost of the investment.

Which of the following is correct?? A. All capital budgeting methods produce the same decision and their use is based on the information available B. Payback period ignores the cash flow after the original investment is recovered C. The accounting rate of return method considers the time value of money D. The cost of capital is the company's desired rate of return

B. Payback period ignores the cash flow after the original investment is recovered

Which of the following may be useful when comparing potential investments of different sizes? A. ARR B. Profitability Index C. Future value of net cash inflows D. Payback method

B. Profitability index

Which of the following is not a factor when considering the time value of money? A. THe interest rate B. The principal amount C. THe payback period D. THe number of periods

C. THe payback period

Which of the following capital budgeting methods uses accrual accounting rather than net cash flows as a basis for calculations? A. Payback method B. Internal rate of return C. Npv D. ARR

D. ARR