111.The payback method of evaluating capital investments measures the recovery of the investment, but it does not measure profitability. True False 112.When a capital investment is expected to...

111.The payback method of evaluating capital investments measures the recovery of the investment, but it does not measure profitability.



True False

112.When a capital investment is expected to provide unequal annual cash inflows, the payback period can be calculated by accumulating the incremental cash inflows until the sum equals the amount of the original investment.



True False

113.When a capital investment is expected to provide unequal annual cash inflows, the payback period cannot be calculated.



True False

114.The unadjusted rate of return is found by dividing the average incremental increase in annual operating income by the cost of the investment.



True False

115.Generally, the unadjusted rate of return should be calculated based on the average investment rather than the amount of the original investment in a depreciable asset such as equipment.



True False

116.A postaudit should be performed at the end of a capital investment project to determine whether the expected results were actually achieved.



True False