1)

Which of the following cash flowsis not considered when using the net presentvalue method?

Future cash inflows.

Future cash outflows.

Past cash outflows.

Non-uniform cash inflows.

Future year-end cash flows.

2)

Which one of the following methods considers the time value ofmoney in evaluating alternative capital expenditures?

Accounting rate of return.

Net present value.

Payback period.

Cash flow method.

Return on average investment.

3)

The discount rate that yields a net present value of zero for aninvestment is the:

Internal rate of return.

Accounting rate of return.

Net present value rate of return.

Zero rate of return.

Payback rate of return.

4)

The following is a partially completed departmental expenseallocation spreadsheet for Brickland. It reports the total amountsof direct and indirect expenses for its four departments.Purchasing department expenses are allocated to the operatingdepartments on the basis of purchase orders. Maintenance departmentexpenses are allocated based on square footage. Compute the amountof Maintenance department expense to be allocated toFabrication.

	Purchasing	Maintenance	Fabrication	Assembly
Operating costs	$32,000	$18,000	$96,000	$62,000
No. of purchase orders			16	4
Sq. ft. of space			3,300	2,700

$6,400.

$9,900.

$8,100.

$9,000.

$25,600.