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Why Is an Adjustment Made to Net Income When Calculating

Question 133

Multiple Choice

Why is an adjustment made to net income when calculating NOPAT?


A) It is an amount on which income taxes are not considered.
B) This adjustment amount has no cost of capital associated with it.
C) Only assets that incur no interest costs are included with NOPAT.
D) Divisional managers have no ability to control costs such as these.

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