COST ACCOUNTING
CAPITAL BUDGETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Capital budgeting techniques are least likely to be used in evaluating the
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Adoption of a new method of allocating non-traceable costs to product lines
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Design and implementation of a major advertising program
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Acquisition of a new aircraft by a cargo company.
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Trade for a star quarterback by a football team
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Explanation:
Detailed explanation-1: -Answer :-Average rate of return method is based on cash flows. 5. Which of the following is not a capital budgeting decision? Inventory control.
Detailed explanation-2: -Accrual principle is not followed in capital budgeting.
Detailed explanation-3: -Capital budgeting is used by companies to evaluate major projects and investments, such as new plants or equipment. The process involves analyzing a project’s cash inflows and outflows to determine whether the expected return meets a set benchmark.
Detailed explanation-4: -Payback Period, Net Present Value Method, Internal Rate of Return, and Profitability Index are the methods to carry out capital budgeting.
There is 1 question to complete.