Which of the following is not a relevant item to consider in cash flow estimation?
A) A change in current assets invested in the project.
B) A change in current liabilities to finance new inventories.
C) Regular meeting fees for the board of directors incurred when the go-no go decision is made.
D) Any net changes in working capital over the life of the investment.

Question

Quizplus · Accepted Answer

Regular meeting fees for the board of directors incurred when the go-no go decision is made are not directly related to the operational cash flows of a project. They are considered sunk costs, which are costs that have already been incurred and cannot be recovered, and therefore, do not affect the incremental cash flows associated with a project's future operations.

Which of the Following Is Not a Relevant Item to Consider