MENU
Which of the following is not a category of relevant cash flows'?
Suggested Answer: C
Get Premium CMA Questions
as Interactive Web-Based Practice Test or PDF
Real Exam Format
Detailed Explanations
Instant Access
Get Your Practice Test
Relevant cash flows are a much more reliable guide when judging capital projects, since only they provide a true measure of a project's potential to affect shareholder value. The relevant cash flows can be divided into three categories. (1) net initial investment, (2) annual net cash flows, and (3) project termination cash flows. An incremental cash flow is the difference in cash received or disbursed resulting from selecting one option instead of another. It is not a category of relevant cash Bows.
51 comments · newest first
KA
Karl
10 months ago
Totally agree, net initial investment is essential!
MA
Macy
11 months ago
Wait, are net initial investments really not a category?
VE
Verona
11 months ago
Incremental cash flows are crucial for analysis.
JO
Jonelle
11 months ago
I think project termination cash flows are relevant too.
AN
Andree
11 months ago
Annual net cash flows are definitely a category.
AL
Alita
12 months ago
I recall that project termination cash flows can be relevant, but I can't remember if they are always included in cash flow analysis.
SL
Slyvia
12 months ago
I'm not entirely sure, but I feel like net initial investment might not be considered a cash flow category in some contexts.
ST
Stephane
12 months ago
I practiced a similar question last week, and I think incremental cash flows are always relevant too.
DE
Deane
1 year ago
I think I remember that annual net cash flows are definitely a relevant category, but I'm a bit unsure about project termination cash flows.
DE
Demetra
1 year ago
I've got this! The category that is not relevant is net initial investment, since that's the upfront cost, not an ongoing cash flow.
ED
Edna
1 year ago
Okay, let me see... I know annual net cash flows and incremental cash flows are relevant, so that leaves project termination cash flows and net initial investment as the options. Tricky!
TA
Talia
1 year ago
Hmm, I'm not totally sure about the different categories of relevant cash flows. I'll have to think this through carefully.
LO
Lonny
1 year ago
This question seems straightforward, I think I can eliminate a few options right away.
GA
Galen
1 year ago
The PMK is a critical part of the wireless security protocol, so I want to make sure I understand this properly. I'll take my time and really analyze each answer choice before selecting the correct one.
RE
Reena
1 year ago
Okay, let me break this down step-by-step. The question is asking if the device supports both DC and AC power inputs. I'll need to carefully consider the wording to determine the correct answer.
TA
Tamra
1 year ago
Hmm, this looks like a tricky one. I'll need to carefully review the steps taken and the expected outcomes to determine the right answer.
DA
Dalene
2 years ago
Wait, are we sure this isn't a 'which one doesn't belong' type of question? I'm feeling a little suspicious here.
JE
Jesusita
2 years ago
I agree, that seems like the odd one out.
CR
Crista
2 years ago
I think it's B) Project termination cash flows.
FL
Floyd
2 years ago
D) Net initial investment.
TR
Tresa
2 years ago
C) Incremental cash flows.
DO
Dottie
2 years ago
B) Project termination cash flows.
MI
Mi
2 years ago
A) Annual net cash flows
LO
Loren
2 years ago
Net initial investment? Seriously? That's clearly a relevant cash flow category. What is this, a trick question?
RE
Ressie
2 years ago
Yes, it is. The question must be trying to trick us.
NO
Novella
2 years ago
Net initial investment is actually a relevant cash flow category.
VI
Virgie
2 years ago
D) Net initial investment.
GL
Glendora
2 years ago
C) Incremental cash flows.
ST
Starr
2 years ago
B) Project termination cash flows.
QU
Queen
2 years ago
A) Annual net cash flows
LA
Lai
2 years ago
Incremental cash flows? That's the way to go. It's the only logical choice here.
LE
Leslie
2 years ago
C) Incremental cash flows.
LI
Lindsey
2 years ago
B) Project termination cash flows.
LO
Loise
2 years ago
A) Annual net cash flows
LU
Ludivina
2 years ago
I'm going with Project termination cash flows. Those are definitely relevant, right?
CH
Cherry
2 years ago
D) Net initial investment is another category of relevant cash flows to consider.
GL
Glory
2 years ago
C) Incremental cash flows are also considered relevant in cash flow analysis.
CA
Carmela
2 years ago
A) Annual net cash flows are definitely a category of relevant cash flows.
BR
Brendan
2 years ago
I agree with Hyman. Project termination cash flows are not relevant cash flows for decision making.
HY
Hyman
2 years ago
I think the answer is B) Project termination cash flows.
NA
Nana
2 years ago
Annual net cash flows? That's a no-brainer. It's definitely a relevant cash flow category.
MA
Marti
2 years ago
D) Net initial investment
ER
Ernestine
2 years ago
C) Incremental cash flows
BE
Beckie
2 years ago
A) Annual net cash flows
SE
Selene
2 years ago
C) Incremental cash flows
DE
Devon
2 years ago
A) Annual net cash flows
JA
Jaime
2 years ago
Annual net cash flows? That's a no-brainer. It's definitely a relevant cash flow category.
VA
Valentin
2 years ago
D) Net initial investment.
MA
Marjory
2 years ago
C) Incremental cash flows.
MA
Maurine
2 years ago
B) Project termination cash flows.
LO
Lou
2 years ago
A) Annual net cash flows