International Accounting
International Accounting
5th Edition
ISBN: 9781259747984
Author: Doupnik, Timothy S., Finn, Mark T., Gotti, Giorgio
Publisher: Mcgraw-hill Education,
Question
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Chapter 10, Problem 1Q
To determine

Identify the three pieces of information that is needed for the calculation of net present value (NPV) for the potential, domestic or foreign, capital investment.

Expert Solution & Answer
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Explanation of Solution

The capital budgeting technique that use the difference of the initial amount invested and sum of the future values of all net cash inflows after-tax is known as the net present value (NPV).

The three piece of information needed for the calculation of the net present value (NPV) for a potential capital investment is the; amount of the initial investment, estimated future cash-flows that would be received from the project over the specified period of time.

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