40. Indicate the section (o perating activities, investing activities, financing activities, or none) in which the following of cash flows prepared by the indirect method: prepared by the ich or the following would be reported on the statement (a) Gain on sale of fixed assets (b) Net income (c) Retirement of long-term debt (d) Sale of capital stock (e) Distribution of stock dividends ( Payment of cash dividends (g) Purchase of fixed assets (h) Sale of fixed assets (i) Receipt of interest revenue G) Payment of interest expense 41. A company is contemplating investing in a new piece of manufacturing machinery. The amount to be invested is $100,000. The present value of the future cash flows at the company's desired rate of return is $105,000. The IRR on the project is 12%, which of the following statements is true? a. The project should not be accepted because the net present value is negative. b. The desired rate of return used to calculate the present value of the future cash flows c. The desired rate of return used to calculate the present value of the future cash flows d. The desired rate of return used to calculate the present value of the future cash flows is less than 12%. is more than 12% is equal to 12%. 42. All of the following qualitative considerations may impact upon capital investment analysis except a. manufacturing productivity b. manufacturing sunk cost c. manufacturing flexibility d. market opportunities 43. In capital rationing, an initial screening of alternative proposals is usually performed by establishing minimum standards. Which of the following evaluation methods are often used? a. cash payback method and average rate of return method b. average rate of return method and net present value method c. net present value method and cash payback method d. internal rate of return and net present value methods When several alternative investment proposals of the same amount are being sidered, the one with the largest net present value is the most desirable. If the 44