QUESTION 1 In a discussion with your boss, a colleague says, "A project's cost of capital is represented by the perceived riskiness of the future cash flows generated by the project. It also represents what investors are paying through opportunity cost in order to provide capital to the project. It is important to always adjust the cost of capital to reflect the impact of taxes." Which part of the above statement is false? the statement regarding perceived riskiness o the statement regarding tax-adjustements O the statement about investor's opportunity cost The entire statement is True QUESTION 2 The following presents the balance sheet for Firm K, along with information from the income statement. If the interest rate charged on Firm K's LT debt is 5%, and % for short-term debt, what is the times interest.eamed ratio? 10 points Income Statement Information Revenue 3,500 EBIT: 800 Net Income: 200 Total Assets 2,000 o Current Assets: 600 Cash: 100 Receivables 200 Inventory 300 Noncurrent Assets: 1,400 .Net PP&E: 1,100 Other NCA: 300 Total Liabilities: 1,500 o Current Liabilities: 700 . Current Debt: 250 Payables: Accruals: 150 o Noncurrent Liabilities: 800 Long Term Det 800 Total Equity: 500 o Common Stock 400 o Retained Earnings 100 20.0 10.0 300 5.0 15.0