IMPORTANCE OF CAPITAL BUDGETING
IMPORTANCE OF CAPITAL BUDGETING
1. Long-term Implications of Capital Budgeting
A capital budgeting decision has its effect over a long time span and inevitably affects the company’s future...
CAPITAL EXPENDITURE
Capital expenditure, or CapEx, are funds used by a company to acquire, upgrade, and maintain physical assets such as property, industrial buildings, or equipment....
Fund Flow Statement
CONCEPT OF “FUND’’:
The term ‘fund’ has been defined and interpreted differently by different experts. Broadly the term ‘fund’ refers to all the financial resources...
BASICS OF CAPITAL BUDGETING
What is Capital Budgeting?
Capital budgeting is defined as the process of planning for projects on assets with cash flows of a period greater than...
Factors Determining Working Capital Needs
FACTORS AFFECTING WORKING CAPITAL
1. Nature of business2. Production policy3. Credit policy4. Inventory policy5. Abnormal factor6. Market conditions7. Conditions of supply8. Business cycle9. Taxation policy10....
Payback Period
Payback Period
Payback period basically pays attention to the speed at which the initial investment made in a project will be recovered by subsequent cash...
FINANCIAL STATEMENT
Financial Statements represent a formal record of the financial activities of an entity. These are written reports that quantify the financial strength, performance and liquidity...
Techniques of Financial Analysis
Techniques of Financial Analysis
Financial Analysis is defined as being the process of identifying financial strength and weakness of a business by establishing relationship between the...
Internal Rate of Return
Internal Rate of Return
‘Internal Rate of Return – IRR’
Internal rate of return (IRR) is a metric used in capital budgeting to estimate the profitability of potential...
Preparation of Cash Flow Statement
Three main sections of Statement of Cash Flows:
Operating Activities: The principal revenue-generating activities of an organization and other activities that are not investing or...
