Which of the Following Statements Best Describes CCA

Multiple Choice

Which of the following statements best describes CCA?

A) Using CCA rather than straight-line depreciation would normally have no effect on a project's total projected cash flows but it would affect the timing of the cash flows and thus the NPV.
B) Corporations must use the same depreciation method (e.g., straight-line or CCA) for stockholder reporting and tax purposes.
C) Since CCA is not a cash expense, it has no effect on cash flows and thus no effect on capital budgeting decisions.
D) Under CCA rules, higher CCA deductions occur in the early years, and this reduces the early cash flows and thus lowers a project's projected NPV.