QUESTION 16 The "net" in Net Initial Cash Outlay refers to the subtraction of the operating expenses from the ICO the discount provided by the seller of the expansion asset the uncollectable portion of the account the sale of the asset to be replaced QUESTION 15 A gain for tax purposes (a tax gain) occurs if the proceeds from selling the old asset exceed the depreciated (book) value the firm buys back its own common stock shares money is spent over and above the value of the project under consideration the asset is an intangible asset QUESTION 14 An increase in net working capital is treated as an investment in the firm's networking systems additional cost at time zero, and recovered in the last year of the project cost of goods sold, unless the firm is using the asset as a short-term investment a sunk cost