All of the following are capital investment decisions except

All of the following are capital investment decisions except:

acquiring $580,000 of common stock.

buying a $4,450,000 manufacturing plant.

purchasing equipment for $54,400.

paying $662,000 to renovate a restaurant.

acquiring $580,000 of common stock.

buying a $4,450,000 manufacturing plant.

purchasing equipment for $54,400.

paying $662,000 to renovate a restaurant.

Solution

A. acquiring $580,000 of common stock.

Capital investment decisions are those decisions that involve current outlays (costs) in return for a stream of benefits in future years.

All of the following are capital investment decisions except: acquiring $580,000 of common stock. buying a $4,450,000 manufacturing plant. purchasing equipment

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