Questions from Managerial Accounting

Q: Net cash inflows and net cash outflows are used in the net

Net cash inflows and net cash outflows are used in the net present value method and in the internal rate of return method. Explain why accounting net income is not used instead of cash flows.

Q: A cost object can be anything for which managers want a separate

A cost object can be anything for which managers want a separate measurement of cost. List three different potential cost objects other than the product itself for the company you have selected.

Q: The decision rule for NPV analysis states that the project with the

The decision rule for NPV analysis states that the project with the highest NPV should be selected. Describe at least two situations when the project with the highest NPV may not necessarily be the be...

Q: List and describe the advantages and disadvantages of the payback method.

List and describe the advantages and disadvantages of the payback method.

Q: List and describe the advantages and disadvantages of the internal rate of

List and describe the advantages and disadvantages of the internal rate of return method.

Q: Use the data you collected in Requirement 2 to calculate each segment’s

Use the data you collected in Requirement 2 to calculate each segment’s ROI. Interpret your results.

Q: “As the required rate of return increases, the net present

“As the required rate of return increases, the net present value of a project also increases.” Explain why you agree or disagree with this statement.

Q: Summarize the net present value method for evaluating a capital investment opportunity

Summarize the net present value method for evaluating a capital investment opportunity. Describe the circumstances that create a positive net present value. Describe the circum-stances that may cause...

Q: Suppose you are a manager and you have three potential capital investment projects

Suppose you are a manager and you have three potential capital investment projects from which to choose. Funds are limited, so you can only choose one of the three projects. Describe at least three me...

Q: The net present value method assumes that future cash inflows are immediately

The net present value method assumes that future cash inflows are immediately rein-vested at the required rate of return, while the internal rate of return method assumes that future cash inflows are...