Question

For capital budgeting decisions. OPTIONS a. depreciation is to be considered b. depreciation is to be ignored c. depreciation is to be calculated at 20 % d. depreciation is to be calculated at 10%​

Answer 1

Answer:

For capital budgeting decisions if we are considering ARR Method then depriciation is to be considered but if you arr considering payback method,discounted payback method,NPV method or IRR method we consider only cash flows abd hence depriciation is to be ignored

Generally we take capital budgeting decisions using NPV method and hence depriciation is to be ignored