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IMANET Exam CMA Topic 2 Question 89 Discussion

Actual exam question for IMANET's CMA exam
Question #: 89
Topic #: 2
[All CMA Questions]

Which of the following is not a category of relevant cash flows'?

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Suggested Answer: C

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.


by Stephaine at Jun 03, 2024, 02:20 AM

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Dalene
11 months ago
Wait, are we sure this isn't a 'which one doesn't belong' type of question? I'm feeling a little suspicious here.
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Jesusita
10 months ago
I agree, that seems like the odd one out.
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Crista
10 months ago
I think it's B) Project termination cash flows.
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Floyd
10 months ago
D) Net initial investment.
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Tresa
10 months ago
C) Incremental cash flows.
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Dottie
10 months ago
B) Project termination cash flows.
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Mi
10 months ago
A) Annual net cash flows
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Loren
11 months ago
Net initial investment? Seriously? That's clearly a relevant cash flow category. What is this, a trick question?
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Ressie
11 months ago
Yes, it is. The question must be trying to trick us.
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Novella
11 months ago
Net initial investment is actually a relevant cash flow category.
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Virgie
11 months ago
D) Net initial investment.
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Glendora
11 months ago
C) Incremental cash flows.
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Starr
11 months ago
B) Project termination cash flows.
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Queen
11 months ago
A) Annual net cash flows
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Lai
12 months ago
Incremental cash flows? That's the way to go. It's the only logical choice here.
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Leslie
11 months ago
C) Incremental cash flows.
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Lindsey
11 months ago
B) Project termination cash flows.
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Loise
11 months ago
A) Annual net cash flows
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Ludivina
1 years ago
I'm going with Project termination cash flows. Those are definitely relevant, right?
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Cherry
11 months ago
D) Net initial investment is another category of relevant cash flows to consider.
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Glory
11 months ago
C) Incremental cash flows are also considered relevant in cash flow analysis.
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Carmela
12 months ago
A) Annual net cash flows are definitely a category of relevant cash flows.
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Brendan
1 years ago
I agree with Hyman. Project termination cash flows are not relevant cash flows for decision making.
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Hyman
1 years ago
I think the answer is B) Project termination cash flows.
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Nana
1 years ago
Annual net cash flows? That's a no-brainer. It's definitely a relevant cash flow category.
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Marti
11 months ago
D) Net initial investment
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Ernestine
11 months ago
C) Incremental cash flows
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Beckie
11 months ago
A) Annual net cash flows
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Selene
11 months ago
C) Incremental cash flows
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Devon
11 months ago
A) Annual net cash flows
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Jaime
12 months ago
Annual net cash flows? That's a no-brainer. It's definitely a relevant cash flow category.
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Valentin
12 months ago
D) Net initial investment.
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Marjory
12 months ago
C) Incremental cash flows.
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Maurine
12 months ago
B) Project termination cash flows.
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Lou
12 months ago
A) Annual net cash flows
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