Briefly describe both the payback period method and the net present value method of comparing investment alternatives.
What will be an ideal response?
The payback period method evaluates alternative investment opportunities based on
the expected amount of time to recover the initial investment. This method does not consider the time value of money and ignores cash flows after the payback period. The net present value method considers the time value of money and all future cash flows. Projected cash flows for each investment are discounted using a required rate of return to determine the net present value. Under this method, the project with the highest positive net present value would be considered the best choice.
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The following data relate to Falcon Company for the year ended December 31, 2012 . Falcon Company uses the cash basis. Sales for cash $180,000 Sales for credit 190,000 Cost of inventory sold 210,000 Collections from customers 350,000 Purchases of inventory on credit 200,000 Payment for purchases 220,000 Selling expenses (accrual basis) 60,000 Payment for selling expenses 70,000 Which of the
following amounts represents income for Falcon Company for the year ended December 31, 2012? a. $90,000 b. $80,000 c. $70,000 d. $60,000 e. None of the answers are correct.
The learning curve is representative of the ________
A) per unit cost of output in the long run B) drop in the average per-unit production cost that comes with accumulated production experience C) number of units the market will buy in a given time period, at different prices that might be charged D) total market demand resulting from different prices E) per unit cost of output in the short run
Forgetting that we have violated moral rules is associated with which cognitive bias?
A. overestimating our ethicality B. favoring members of our own group C. forgiving our own unethical behavior D. implicit prejudice
A buyer may revoke an acceptance of goods if
a. the nonconformity does not impair the value of the goods. b. the buyer had a legitimate reason for the initial acceptance. c. the buyer knew the nonconformity could not be cured. d. the buyer thought they could easily cover.