1. All of the following influence capital budgeting cash flows EXCEPT:

accelerated depreciation.

salvage value.

tax rate changes.

method of project financing used.

2. In proper capital budgeting analysis we evaluate incremental

accounting income.

cash flow.

earnings.

operating profit.

3. The estimated benefits from a project are expressed as cash flows instead of income flows because:

it is simpler to calculate cash flows than income flows.

it is cash, not accounting income, that is central to the firm's capital budgeting decision.

this is required by the Internal Revenue Service.

this is required by the Securities and Exchange Commission.