[18] Tabrez Ltd. has gathered the following data on a proposed investment project: Investment required in...

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[18] Tabrez Ltd. has gathered the following data on a proposed investment project: Investment required in equipment Annual cash inflows Salvage value Life of the investment 142,500 30,000 0 8 years 10% Required rate of return The rate of return on the investment is closest to: a) 8.55% b) 10.00% c) 21.05% d) 33.55% [19] Which of the following is not a benefit of budgeting? [20] a) It reduces the need for tracking actual cost activity b) It sets benchmarks for evaluation performance c) It uncovers potential bottlenecks d) It formalises a manager's planning efforts 3 Mark 1 Mark If the average cost per unit of product is the same for all levels of activity, the company's cost structure: a) Must include only variable costs b) Must include only fixed costs c) Must include some fixed costs and some variable costs d) Cannot be determined from the information given 1 Mark Total 40 Marks [18] Tabrez Ltd. has gathered the following data on a proposed investment project: Investment required in equipment Annual cash inflows Salvage value Life of the investment 142,500 30,000 0 8 years 10% Required rate of return The rate of return on the investment is closest to: a) 8.55% b) 10.00% c) 21.05% d) 33.55% [19] Which of the following is not a benefit of budgeting? [20] a) It reduces the need for tracking actual cost activity b) It sets benchmarks for evaluation performance c) It uncovers potential bottlenecks d) It formalises a manager's planning efforts 3 Mark 1 Mark If the average cost per unit of product is the same for all levels of activity, the company's cost structure: a) Must include only variable costs b) Must include only fixed costs c) Must include some fixed costs and some variable costs d) Cannot be determined from the information given 1 Mark Total 40 Marks