Why does capital budgeting rely on an analysis of cash flows rather than on net income? Base your answer on the accounting principles of recognizing and reporting revenue and expenses. Describe two...

Why does capital budgeting rely on an analysis of cash flows rather than on net income?

Base your answer on the accounting principles of recognizing and reporting revenue and expenses.


Describe two capital budgeting decisions based on the time value of money.

Which of the two methods would you select for a capital budgeting project and why?