Capital budgeting process, finance, Other Engineering

Capital budgeting process:
When investing in a long term assets, the project has been evaluated in term of its profitability and expected cash flow in the future. The capital budgeting process involves six steps as follows:
1. Calculate the cost of the project.
2. Estimation of the expected cash flows from the project in the future. Also calculate the residual value of the asset at the end of its life.
3. Calculate the probability distribution of the cash outflows.
4. Determine the present value of expected cash inflow
5. Determine the present value of cash inflow
6. Compare the present value of cash inflow with the cash outflow with the cash outflow. If the present value of cash inflow is higher than the outflow accept the project (Capital budgeting process, project analysis 2010).
Posted Date: 2/6/2012 10:31:02 PM | Location : United States







Related Discussions:- Capital budgeting process, finance, Assignment Help, Ask Question on Capital budgeting process, finance, Get Answer, Expert's Help, Capital budgeting process, finance Discussions

Write discussion on Capital budgeting process, finance
Your posts are moderated
Related Questions


Thermal equilibrium The definition and measurement of temperature must be logically preceded by the concept of thermal equilibrium and the Zeroth law. To determine operationally wh

The operational amplifier : The integrated circuit operational amplifier is one of the most useful and versatile electronic devices available today.  The name 'operational ampl

what are wavefronts and how are they useful in the field of optics and medicine?

how can you access the general purpose registers of Microprocessor in windows XP/2000/98...

Measurements of Economic Worth There are several methods of economic worth used to compare alternatives. If you decide to use present worth analysis, then you have indicate a


Prepare a list of questions that should be resolved in identifying each of the following problems: a. Develop an improved manual gearshift for a mountain bike. b. Develop a hands-f

How do I finish a tough Engineering assignment in excel?