15 18. www. 21 Which of the following statements is INCORRECT? Conflicts between two mutually exclusive projects occasionally occur, where the NPV method ranks one project higher but the IRR method puts the other one first. In theory, such conflicts should be resolved in favor of the project with the higher NPV. Account payable is NOT a capital component when calculating the weighted average cost of capital (WACC) for use in capital budgeting. Firms with riskier projects generally have a higher WACC. The longer a project's payback period, the more desirable the project is normally considered to be by this criterion. Both the regular payback method and the discounted payback method ignore cash flows beyond the payback period