Income taxes have no effect on whether a capital budgeting project should or should not be accepted in a for-profit company.

Question

Quizplus · Accepted Answer

Income taxes can have a significant effect on the cash flows associated with a capital budgeting project, such as tax deductions for depreciation and interest expenses. These tax effects need to be considered in the analysis before deciding whether a project should be accepted or not.

Income Taxes Have No Effect on Whether a Capital Budgeting