Q. Which of the following statements is most correct? (Solved)
1. investment in working capital must be depreciated over the project life according to a straight-line method.
2. if a project incurs an operating loss (a negative taxable income) during a typical tax year, the firm pays no income taxes during that year.
3. whenever a project requires an investment in working capital, the profitability of the project will be affected negatively.
4. all of the above
- c. whenever a project requires an investment in working capital, the profitability of the project will be affected negatively.