Use real interest rate to calculate after-tax present worth

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Reference no: EM13836943

1. If direct material and labor cost is not the major component in the cost structure, it is more appropriate to use activity based costing to allocate the overhead cost.

True

False

2. By life cycle viewpoint, salvage value summarizes all the costs and revenues occurring in the last service year of an asset.

True

False

3. If all the cash flows activities are presented in constant dollar, we should use the real interest rate to calculate the after-tax present worth.

True

False

Reference no: EM13836943

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