公司理财-习题库-Chap010

CHAPTER10MakingCapitalInvestmentDecisionsI.DEFINITIONSINCREMENTALCASHFLOWSa1.Thechangesinafirm’sfuturecashflowsthatareadirectconsequenceofacceptingaprojectarecalled_____cashflows.a.incrementalb.stand-alonec.after-taxd.netpresentvaluee.erosionSTAND-ALONEPRINCIPLEb2.Theevaluationofaprojectbasedsolelyonitsincrementalcashflowsisthebasisofthe:a.incrementalcashflowmethod.b.stand-aloneprinciple.c.dividendgrowthmodel.d.after-taxsalvagevalueanalysis.e.discountedpaybackmethod.SUNKCOSTSc3.Acostthathasalreadybeenpaid,ortheliabilitytopayhasalreadybeenincurred,isa(n):a.salvagevalueexpense.b.networkingcapitalexpense.c.sunkcost.d.opportunitycost.e.erosioncost.OPPORTUNITYCOSTSd4.Themostvaluableinvestmentgivenupifanalternativeinvestmentischosenisa(n):a.salvagevalueexpense.b.networkingcapitalexpense.c.sunkcost.d.opportunitycost.e.erosioncost.EROSIONCOSTSe5.Thecashflowsofanewprojectthatcomeattheexpenseofafirm’sexistingprojectsarecalled:a.salvagevalueexpenses.b.networkingcapitalexpenses.c.sunkcosts.d.opportunitycosts.e.erosioncosts.CHAPTER10PROFORMAFINANCIALSTATEMENTSa6.Aproformafinancialstatementisonethat:a.projectsfutureyears’operations.b.isexpressedasapercentageofthetotalassetsofthefirm.c.isexpressedasapercentageofthetotalsalesofthefirm.d.isexpressedrelativetoachosenbaseyear’sfinancialstatement.e.reflectsthepastandcurrentoperationsofthefirm.MACRSDEPRECIATIONb7.ThedepreciationmethodcurrentlyallowedunderUStaxlawgoverningtheacceleratedwrite-offofpropertyundervariouslifetimeclassificationsiscalled_____depreciation.a.FIFOb.MACRSc.straight-lined.sum-of-yearsdigitse.curvilinearDEPRECIATIONTAXSHIELDc8.Thecashflowtaxsavingsgeneratedasaresultofafirm’stax-deductibledepreciationexpenseiscalledthe:a.after-taxdepreciationsavings.b.depreciablebasis.c.depreciationtaxshield.d.operatingcashflow.e.after-taxsalvagevalue.CASHFLOWFROMPROJECTSd9.Thecashflowfromprojectsforacompanyiscomputedasthe:a.netoperatingcashflowgeneratedbytheproject,lessanysunkcostsanderosioncosts.b.sumoftheincrementaloperatingcashflowandafter-taxsalvagevalueoftheproject.c.netincomegeneratedbytheproject,plustheannualdepreciationexpense.d.sumoftheincrementaloperatingcashflow,capitalspending,andnetworkingcapitalexpensesincurredbytheproject.e.sumofthesunkcosts,opportunitycosts,anderosioncostsoftheproject.EQUIVALENTANNUALCOSTe10.Theannualannuitystreamofpaymentswiththesamepresentvalueasaproject’scostsiscalledtheproject’s_____cost.a.incrementalb.sunkc.opportunityd.erosione.equivalentannualII.CONCEPTSINCREMENTALCASHFLOWb11.Onepurposeofidentifyingalloftheincrementalcashflowsrelatedtoaproposedprojectisto:a.isolatethetotalsunkcostssotheycanbeevaluatedtodetermineiftheprojectwilladdvaluetothefirm.b.eliminateanycostwhichhaspreviouslybeenincurredsothatitcanbeomittedfromtheanalysisoftheproject.c.makeeachprojectappearasprofitableaspossibleforthefirm.d.includeboththeproposedandthecurrentoperationsofafirmintheanalysisoftheproject.e.identifyanyandallchangesinthecashflowsofthefirmforthepastyearsotheycanbeincludedintheanalysis.INCREMENTALCASHFLOWe12.Whichofthefollowingareexamplesofanincrementalcashflow?I.anincreaseinaccountsreceivableII.adecreaseinnetworkingcapitalIII.anincreaseintaxesIV.adecreaseinthecostofgoodssolda.IandIIIonlyb.IIIandIVonlyc.IandIVonlyd.I,III,andIVonlye.I,II,III,andIVINCREMENTALCASHFLOWc13.Whichoneofthefollowingisanexampleofanincrementalcashflow?a.theannualsalaryofthecompanypresidentwhichisacontractualobligationb.therentonawarehousewhichiscurrentlybeingutilizedc.therentonsomenewmachinerythatisrequiredforanupcomingprojectd.thepropertytaxesonthecurrentlyownedwarehousewhichhasbeensittingidlebutisgoingtobeutilizedforanewprojecte.theinsuranceonacompany-ownedbuildingwhichwillbeutilizedforanewprojectSTAND-ALONEPRINCIPLEd14.Thestand-aloneprincipleadvocatesprojectanalysiswhichisfocusedon_____costs.a.sunkb.totalc.variabled.incrementale.fixedCHAPTER10SUNKCOSTc15.Sunkcostsincludeanycostthat:a.willchangeifaprojectisundertaken.b.willbeincurredifaprojectisaccepted.c.haspreviouslybeenincurredandcannotbechanged.d.ispaidtoathirdpartyandcannotberefundedforanyreasonwhatsoever.e.willoccurifaprojectisacceptedandonceincurred,cannotberecouped.SUNKCOSTd16.Youspent$500lastweekfixingthetransmissioninyourcar.Now,thebrakesareactingupandyouaretryingtodecidewhethertofixthemortradethecarinforanewermodel.Inanalyzingthebrakesituation,the$500youspentfixingthetransmissionisa(n)_____cost.a.opportunityb.fixedc.incrementald.sunke.relevantEROSIONb17.Erosioncanbeexplainedasthe:a.additionalincomegeneratedfromthesalesofanewlyaddedproduct.b.lossofcurrentsalesduetoanewprojectbeingimplemented.c.lossofrevenueduetoemployeetheft.d.lossofrevenueduetocustomertheft.e.lossofcashduetotheexpensesrequiredtofixaparkinglotafteraheavyrainstorm.EROSIONa18.Whichofthefollowingareexamplesoferosion?I.thelossofsalesduetoincreasedcompetitionintheproductmarketII.thelossofsalesbecauseyourchiefcompetitorjustopenedastoreacrossthestreetfromyourstoreIII.thelossofsalesduetoanewproductwhichyourecentlyintroducedIV.thelossofsalesduetoanewproductrecent