Question

Pick the correct statement from below. Multiple Choice Project analysis should only include the cash flows that affect the income statement. A project can create a positive operating cash flow without affecting sales. The depreciation tax shield creates a cash outflow for a project. Interest expense should always be included when analyzing cost-cutting projects. A bid price maximizes profits on a project for the bidding firm.

Answer 1

A project can create a positive operating cash flow without affecting sales.

Step-by-step explanation:

A project cash flow analysis permits to look the cash inflows and cash outflows that are along with the existing or upcoming project. Also it addressed the opportunity cost

So as per the given situation, it involved that project in which it establish the positive operating cash flow without impacting the sales

Therefore as per the given options, the above statement represent an answer