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Created by dylan_earl
over 9 years ago
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Question | Answer |
What is an incremental cash flow? | Cash flow with project - cash flow without project |
What is the difference between a firms short term assets and liabilities? | Net working capital |
What is a cash inflow | When inventories are sold and accounts receivable are collected (and its positive) |
Total Cash flow consists of 3 components: | 1. Cash flow from investments in plant/equipment (Capital) 2. Cash from investment in working capital 3. Cash flow from operations |
What is a word for Capital Cost Allowance (CCA) | Depreciation |
Tax savings from Depreciation is called the: | CCA Tax Shield |
Straight line depreciation is used for intangible assets T/F | True |
Most assets use a declining balance method for Depreciation T/F | True |
What do we do differently with NPV when there are Tax Shields | Calculate PV of operating cash flow separately from PV of CCA Tax shields |
CCA Tax shields only last as long as the asset T/F | False. Infinite Life |
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